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The True Cost of Living in Miami 2023

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Written by Ashlyn Brooks – Edited by Mariah Posey – Reviewed by Mark Friedlander – 14 Minute read

Our writers and editors used an in-house natural language generation platform to assist with portions of this article, allowing them to focus on adding information that is uniquely helpful. The article was reviewed, fact-checked and edited by our editorial staff prior to publication.

Many people envision the palm trees and bright lights of Miami when thinking of the Sunshine State. But the housing market in Florida has significant financial challenges, which can make living in the popular city more expensive than many people anticipate. If moving to Miami is in your sights, you should understand the true cost of living there before packing your bags.

Miami cost of living and population statistics

The cost of living in Miami is driven by factors besides housing.

Faith Based Events
  • The cost of living in Miami increased nearly 3 percent from 2023 (Salary.com)
  • Transportation, food and housing costs saw the most significant cost increases since 2023. (Salary.com)
  • Florida experienced a 1.6 percent population growth rate in 2023 — the second-fastest growing state in the U.S. — adding 365,205 residents (U.S. Census)
  • Miami’s cost of living is 15.4 percent higher than the national average (Salary.com)

Housing costs in Miami

When evaluating the true cost of living in Miami, housing is one of the most important factors. Just like cost is an issue when choosing a Miami 5-Star Luxury Hotel. According to RealtyHop’s Housing Affordability Index for April 2024, Miami is the second-least affordable place to live in the U.S. Miami homeowners average $4,347 per month on mortgage and tax payments — which is a staggering $52,164 per year.

For the first time since 1970, the U.S. Census recorded a population decrease in Miami-Dade County of 1 percent from April 1, 2020 to July 1, 2022. While many people are moving into the area, 79,535 moved out of Miami into other states or counties within Florida. For most people, housing is their biggest expense and unaffordable rent and home prices are cited as to why residents within the middle-class income spectrum are leaving. Whether you rent or own, here is what you need to know about the cost of housing in Miami.

Average cost for a house

The average home price in Miami has skyrocketed in recent years. This is partly due to the fact that many Americans moved to Florida since the COVID-19 pandemic began in 2020.

In the 12 months after July 1, 2020, an estimated 220,890 people moved to Florida according to the U.S. Census Bureau — the biggest population increase of any state during that time frame. In 2023, Florida experienced even more population growth with 365,205 new residents, accounting for 93 percent of the nation’s growth alongside Texas, North Carolina and Georgia. That means, on average, there were about 1,000 new Florida residents moving from other states per day.

During the pandemic, Florida was a popular place to move because of the lack of income tax, moderate real estate taxes, warm weather year-round and spacious neighborhoods. Due to increased housing demands, the average Florida sold home price rose from $360,000 in 2019 to $560,000 as of April 2024, with a median price per square footage of $510. The housing market in Miami shows an overall upward trend thus far 2024.

Homeowners insurance

Miami real estate is located in the heart of Florida’s homeowners insurance crisis. Increases in the severity and frequency of flooding and tropical storms combined with inflation, insurance fraud and a rocky economy have caused several companies to stop writing homeowners insurance coverage in Florida. As a result, homeowners have limited options and higher premiums. Coastal cities like Miami are particularly vulnerable to catastrophic losses, and with high replacement costs, some homeowners are forced to secure coverage with Citizens Insurance, Florida’s government-backed insurer of last resort.

Houses are a significant investment, and home insurance can help protect your finances if your property or belongings are damaged by common weather-related risks. When searching for cheap home insurance in Miami, it’s good to remember that cheap is relative. The average cost of Miami home insurance in May 2024 is $11,963 per year for $300,000 in dwelling coverage, which is more than five times the national average of $2,153. Compared to the Florida state average of $6,366 for the same level of coverage, Miami homeowners pay 88 percent more.

Since even the best home insurance policies usually exclude flood damage, another factor to consider is the cost of flood insurance. If you are unable to secure flood insurance through a private provider in the area, you can purchase a policy through the National Flood Insurance Program (NFIP). On average, the yearly expense for an NFIP policy in Miami-Dade is $829, but this can vary significantly depending on the ZIP code, home construction and several other rating factors.

Average cost for an apartment

Renting is usually cheaper than purchasing a home. But in Miami, renting an apartment is still quite expensive. According to RentCafe, the average cost of rent for an apartment in Miami is $2,538 per month for an 892-square-foot apartment. For perspective, the national average cost of rent for an apartment of the same size is $1,713 per month. The most expensive neighborhoods to rent in are Brickell Key ($4,131), Brickell ($3,343) and Breezeview Manors ($3,303).

However, the cost of rent in Miami depends on factors like the location, size of the rental and the quality of the unit.

In addition, you may also want to consider the fact that Miami has been experiencing a housing shortage since the mass migration to Florida began over the last few years. This could make it more difficult to find housing, let alone affordable housing. Rent prices have been steadily increasing, with no signs of slowing down.

Renters insurance

Renting an apartment rather than buying a house could be a cheaper option. But in this case, you may still want to consider purchasing a renters insurance policy. In fact, many Miami landlords require tenants to carry renters insurance before signing a lease.

A standard renters insurance policy covers personal property, personal liability and additional living expenses. It’s one of the cheapest types of insurance you can get, and it’s much less expensive than homeowners insurance.

However, renters in Miami also face flood risks. Because renters insurance does not cover flood damage, you may want to speak with your agent about your flood insurance options. While flood insurance can be expensive, renters pay drastically less than homeowners since it only covers your personal property. According to FEMA, some flood policies for renters start at just $100 per year. Without flood insurance, if a hurricane or severe storm causes a flood that wipes out everything you own, you would be responsible for replacing your belongings out-of-pocket.

National housing market statistics

Miami isn’t the only metropolitan area experiencing an increased cost of living. Here are some recent housing market trends from across the country:

  • The current national average rate for a 30-year fixed rate refinance mortgage is 7.35%. (Bankrate.com)
  • As of March 2024, the median price of existing home sales is $393,500. (National Association of Realtors)
  • For March 2024, pending home sales were up 6.8% month-over-month in the West, but decreased 4.3% month-over-month in the Midwest. (NAR)
  • Existing home sales decreased in the Northeast, Midwest, South and West regions. (NAR)
  • As of the first quarter of 2024, the U.S. rate of homeownership is 65.6%, virtually the same as the 2023 rate of 66%. (U.S. Census)
  • The Midwest region of the country has the highest rate of homeownership at 69.4% as of the first quarter of 2024. (U.S. Census)
  • 42% of millennial homebuyers have buyers’ remorse, citing maintenance and other hidden costs of homeownership being more expensive than anticipated. (Bankrate)
  • Millennials were responsible for 28% of home purchases in 2022. (Fool.com)
  • In 2023, 25% of home purchases were over the listing price. (NAR)

The cost of driving in Miami

The cost of driving and car ownership in Miami is increasing alongside the cost of housing. Here is what you need to know about car prices in Miami and how much it costs to insure your vehicle in the state of Florida.

Car prices in 2024

Car prices are up across the country, and that includes in Miami. While average car prices are slowly dropping as of January, finding an affordable vehicle is still very difficult.

According to a report from Kelley Blue Book, the average price of a new car in January 2024 is $47,401, down 3.5 percent from January 2023. Used cars are only a slightly better deal these days. The average price for a used car in January 2024 was $25,328, down 4 percent from the previous year.

Even if you can find a great deal on a car, be prepared to sit in traffic. The average one-way commute in Miami takes 28.1 minutes. That’s almost two minutes longer than the U.S. average commute time of 26.4 minutes. Round-trip, you are looking at an average commute of almost one hour per day in Miami.

Car insurance

In Florida (like in most states), car insurance is a legal requirement. In addition, Florida is a no-fault state, which means drivers are required to carry personal injury protection (PIP).If you get injured in an accident, PIP pays for your medical bills and lost wages, up to coverage limits, regardless of which driver was at fault for the crash.

However, having a comprehensive car insurance policy in Florida could be extremely important. Data shows that there are more accidents in Miami-Dade County than anywhere else in the state of Florida, and nearly 16 percent of Florida drivers are estimated to be uninsured. Incidents of staged accidents are also particularly prevalent in the state, leading to a high volume of auto insurance fraud. With the city’s high likelihood of accidents, having a robust coverage policy is especially important.

Before you purchase a car insurance policy, it’s usually a good idea to shop around and get quotes from a few different companies. Keep in mind that some car insurance companies offer cheaper rates than others, so you should be able to find a policy that fits within your budget, especially if you can take advantage of discounts. The average cost of full coverage car insurance in Miami in May 2024 is $4,454 per year and $1,414 per year for minimum coverage, much higher than the national averages of $2,299 and $637 for the same coverage types, respectively. Miami car insurance is also significantly more expensive on average in comparison to the statewide averages of $3,579 for full coverage and $1,173 for minimum coverage.

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This article originally appeared here and was republished with permission.

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