Market Insights | Winter 2025 | Miami
Winter 2025
Market
Rent
Average
Occupancy
12 Mo. Sales
Volume
YoY Rent
Change
The Miami-Fort Lauderdale-West Palm Beach metropolitan area is the cultural, economic, and financial center of South Florida and is one of the largest urban areas in the country. Greater Miami accounts for over 90% of the economic activity in the region and contains the highest concentration of international banks in the nation. Miami's favorable pro-business environment has attracted large companies in recent years, and its primary economic drivers are in the industries of construction, trade, transportation, and utilities, retail trade, tourism, education and health care, and professional and business services.
PortMiami had another record-breaking year in Fiscal Year 2024 in cruise and cargo operations. Known as the” Cruise Capital of the World,” PortMiami is the largest passenger port in the world and is recognized as a global gateway, connecting Miami to over 140 destinations worldwide. The port welcomed a record 8.2 million cruise passengers, a 12.8% increase from its previous record of 7.3 million in 2023. Eight new ships debuted including Royal Caribbean Group’s Icon of the Seas, the largest cruise ship in the world. Port Miami has an annual economic impact of over $43 billion on the region and supports a total of roughly 334,000 jobs.
Other historic milestones include a record-breaking 1.08 million TEUs (twenty-foot equivalent units) in cargo volume in 2024, MSC Cruises’ new Cruise Terminal AA, slated to open in April of this year as the largest cruise terminal in the world, and the recent launch of the shore power project. PortMiami is the first major cruise port on the U.S. eastern seaboard offering shore power capability at five cruise berths.
Employment
Greater Miami ranked #1 in the U.S. for private sector job growth in August 2024 with 33,300 jobs gained, a 2.9% year-over-year increase compared to 1.4% nationally. In December 2024, greater Miami had a job growth rate increase of 1.3% compared to the national rate of 1.4%. Job gains occurred in seven out of ten supersectors, with the largest growth rates in the construction, other services, government, and leisure and hospitality industries. The construction industry reported a job growth rate of 5.9% year-over-year with 9,400 new jobs added. Leisure and hospitality added 8,800 new positions, an increase of 2.5% over the previous year.
The Miami-Fort Lauderdale-West Palm Beach Metropolitan Statistical Area (MSA) comprises three metropolitan divisions - separately identifiable employment centers within the greater metro area. Total nonfarm employment for the Miami MSA increased by 49,200 over the year in November 2024 and increased by 38,200 nonfarm positions in December 2024.
The Miami-Miami Beach-Kendal division accounted for approximately 45% of the metro area’s total nonfarm employment and gained 24,800 jobs year-over-year. The Fort Lauderdale-Pompano Beach-Deerfield Beach division represented 31% of the employment in the metropolitan statistical area (MSA) and gained 13,000 jobs over the past 12 months. The West Palm Beach-Boca Raton-Delray Beach metro division accounted for 24% of regional employment and gained 16,100 new positions.
"The reduction of Florida’s commercial lease sales tax rate, also known as the Business Rent Tax, from 4.5% to 2.0%, provides Florida employers with at least an estimated $1 billion in tax relief, making it easier for existing business to succeed and attracting new businesses. A stronger economy and the zero tax on state income will continue to sustain the migration of people from states with high tax burden and housing costs such as New York, San Francisco, and Los Angeles." - MIAMI REALTORS, Southest Florida 2024-2025 Housing Outlook
| % ∆ from December 2023 | |||
|---|---|---|---|
| Metro Area Employment (Thousands) | December 2024 | Miami | National |
| Total Nonfarm | 3,017.4 | 1.3% | 1.4% |
| Mining and Logging | - | - | -1.2% |
| Construction | 167.5 | 5.9% | 2.4% |
| Manufacturing | 97.2 | -3.5% | -0.7% |
| Trade, Transportation, and Utilities | 682.9 | 0.7% | 0.7% |
| Information | 55.9 | 0.7% | -0.3% |
| Financial Activities | 217.8 | -1.3% | 0.6% |
| Professional and Business Services | 523.1 | -0.4% | 0.3% |
| Private Education and Health Services | 469.4 | 2.0% | 3.8% |
| Leisure and Hospitality | 353.2 | 2.6% | 1.8% |
| Other Services | 122.2 | 4.3% | 1.2% |
| Government | 327.3 | 2.9% | 1.8% |
Source: GREA Research, U.S. Bureau of Labor Statistics
Rental Market
Miami has the third-lowest vacancy rate in the state, and rent increases are outpacing those in similarly sized cities like Tampa, Orlando, and Jacksonville. Miami’s annual average rent growth increased by 1.7% in 2024, outperforming the national average rent growth gain of 1.1%. Demand in the luxury asset class increased 10%, closer to the annual growth trend of 12% over the past five years. Construction starts declined in 2024 and will decrease significantly in 2025. Still, Miami has the largest pipeline of new multifamily developments in Florida. New deliveries will be elevated throughout the year, rendering an increase in concessions and flat to moderate rent growth. The downtown Miami submarket contains over half of new multifamily development, and unstabilized vacancies are projected to increase to over 11% through 2025 and into 2026. Unstabilized Class A properties across greater Miami are forecasted to remain above 9%, and vacancies in the mid- to lower-tier asset class are expected to remain below 6%.
Demand for Class-A properties remains strong despite the current oversupply of luxury units. Long-term trends suggest a sustained renter preference for newer, upscale properties into the foreseeable future. Miami’s strong and diversified economy, solid job growth, and the in-migration of highly skilled, younger professionals in recent years will aid in bolstering demand and keep vacancy rates below the national average throughout 2025.
Average Monthly
Mortgage Payment
Average Monthly
Rent
Source: Investopedia, $522,500 median home value, 20% down, 6.72% interest rate, 30 year fixed, includes taxes.
Average Rent / Vacancy
Asking Rent / Bedroom
Multifamily Construction
There are 72 properties with 26,893 units under construction in the Miami metro, representing 13.4% of existing inventory. Construction starts totaled over 11,300 units in 2024, above the nearly 7,600 starts in 2023 but 4,100 units fewer than the 15,400 units under construction in 2022. Over 50% of the new supply is concentrated in downtown Miami, and 90% of the new supply underway is in the luxury segment. Downtown Miami's supply is expected to increase by over 50% over the next three years. Even with the heaviest construction pipeline in the state, annual rent gains have outperformed other major Florida metro markets like Tampa, Orlando, and Jacksonville.
In 2024, deliveries tallied 9,352 units, and just over 8,000 units are expected to be delivered by the end of 2025. The absorption of 8,000 units in 2024 far exceeded the 4,975 units absorbed in 2023 and was well above the previous five-year absorption average of 6,574 units.
Multifamily Completions
Past 12 Months
Single Family
Permits
Multifamily Permits
(5+ Units)
Median Single
Family Price
Completions / Net Absorption
Persistently high construction costs and interest rates will cause a sharp decline in construction starts in 2025, easing supply-side pressure over the next two years.
Units by Submarket Delivering in 2025
Units Under
Construction
Units UC Delivering
in the Next 4 Quarters
| Submarket | Units Under Construction | % of Total UC | 12 Month Deliveries |
|---|---|---|---|
| Downtown Miami | 16,363 | 51.8% | 2,404 |
| North Miami Beach | 1,738 | 8.7% | 1,284 |
| Miami Gardens / Opa-Locka | 578 | 2.7% | 1,276 |
| Homestead / South Dade | 615 | 4.7% | 1,063 |
| Kendall | 102 | 0.6% | 918 |
| Miami Springs / Doral | 1,878 | 8.8% | 893 |
| Hialeah/ Miami Lakes | 1,218 | 5.6% | 372 |
| Little Havana | 786 | 4.6% | 372 |
| Aventura | 1,331 | 49.0% | 278 |
| Coral Gables | 1,481 | 14.0% | 196 |
| Outlying Miami-Dade County | 0 | 0.0% | 100 |
| Coconut Grove | 0 | 0.0% | 46 |
| North Beach | 127 | 1.8% | 5 |
| Mid-Beach | 178 | 25.6% | 0 |
| South Beach | 225 | 3.3% | 0 |
| Westchester / Tamiami | 0 | 0.0% | 0 |
Multifamily Sales
Multifamily transaction volume reached $1.1 billion over the past year, a 35.3% decrease from the $1.7 billion recorded in 2023. This decline reflects a return to pre-pandemic norms, aligning with the 10-year average of $1.8 billion. In 2024, there were three transactions exceeding $100 million each, all for stabilized assets. This trend suggests a growing investor preference for stabilized properties located outside of oversupplied urban core areas.
YTD 12 Mo. Transaction Volume
12 Mo. Change
12 Month Market Price/Unit
Annual Price Change
Average Sales PPU / Cap Rate
After record transaction volumes exceeding $4 billion in 2021 and 2022, activity has slowed in the past two years due to economic challenges. Rising cap rates, now above 6%, along with tighter lending, higher interest rates, and increased debt costs, have dampened transaction volume and price growth. However, Miami remains an attractive market for long-term multifamily investment, supported by stable supply and demand, ongoing economic and job growth, and favorable demographics.
Team
Ken Wellar
Founding Partner
Jesus “Mando” de Armas
Associate Director
Steffan Ramos
Associate