A few changes could be all it takes to address high housing costs in the Sunshine State — though it may not be so simple.
That’s according to real-estate expert Dr. Owen Beitsch, an adjunct professor at UCF and senior director for the GAI Consultants firm.
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In 2022, he and his firm were tasked with putting together a study analyzing the state’s housing markets as Orange County considered a rent control ordinance.
The study identified a series of issues associated with the local housing market. Beitsch agreed to speak with News 6 this month to discuss some of his earlier findings that may still be market influences.
Below are some of the factors that Beitsch said are contributing to the state’s housing crisis.
1 — HOUSING SIZES
A big cause behind homes becoming too costly is that prospective buyers are looking for more space with smaller family sizes, Beitsch argued, with builders and developers willing to address this demand.
For example, the median square footage of a single-family home built in the 1960s or earlier is roughly 1,500 square feet, according to federal data.
But in recent decades, that number has swelled to well over 2,000 square feet.
In addition, new homes today come with more amenities than in prior decades, further adding to the price tag that a homeowner can expect to face. To make matters worse, there’s a particular demand for new housing, Beitsch explained.
He added that family sizes in the U.S. have also decreased on average from about four people per household to roughly 2.5.
In short: there are fewer people living in more space. One person now occupies the space once occupied by an entire family in 1950.
This combination of factors results in a big boost to demand and the nature of the housing unit itself, which together ultimately causes costs to rise.
2 — WAY MORE PEOPLE
Unsurprisingly to many Florida natives, the state has been a hotspot for many Americans across the country.
This massive influx of new residents also causes demand for housing to skyrocket, which is only intensified by how rapidly they’re moving to the state.
Of course, many of these newcomers are concentrated in urban centers like Orlando, Tampa and Miami.
But Beitsch said that just like a “sand pile,” the number of people who can fit in one spot will eventually hit a soft limit, causing these migrants to “slip” into more suburban areas, so prices will increase in those settings, as well.
3 — RULES AND REGULATIONS
Beitsch maintained that he doesn’t oppose all types of housing regulations — though he posited that they don’t necessarily help with high housing costs.
For example, the Florida Building Code presents very specific requirements for life, health and safety purposes.
Some local governments, though, go beyond these requirements by stipulating additional features like sprinklers in certain homes, as well. These requirements drive up the cost of construction.
Furthermore, local governments often set up minimum home size requirements, which prevent construction of smaller — and thus potentially cheaper — housing options.
And with zoning rules limiting the amount of land available for housing, these factors only contribute to higher housing costs in many parts of the state.
However, Beitsch argued that making regulations more flexible and allowing for things like “granny flats” and accessory-dwelling units could help increase the supply of affordable housing in the state.
State lawmakers made such a proposal earlier this year (SB 184), which would have required local governments to allow for these sorts of additions to existing properties.
But despite making decent headway through the Legislature, the bill ultimately died in the Senate.
4 — NOT ENOUGH HOUSING
Just as there’s incredibly high demand for housing in Florida, so too is there a major lack of affordable options.
Because the state’s construction pace lags demand, the price effects are strong and impact affordable housing in particular.
While some advocates have pushed for rent control, such as with Orange County in 2022, Beitsch said that it’s a bad idea.
That’s because price ceilings reduce incentives for suppliers to actually produce more housing — something that would only make affordable housing even harder to find.
[BELOW: Interact with the supply-demand graph to explore why a price ceiling causes shortages]