SWFL renters gain upper hand as Fort Myers vacancy rate nears 20%

FORT MYERS, Fla. (WINK) — Southwest Florida renters are watching apartment vacancy rates climb and rents fall after years of rising prices.

Fort Myers' apartment vacancy rate is approaching 20%, while rents are dropping. WINK News looked at data from CoStar Analytics, spoke with Dr. Shelton Weeks, a real estate professor at FGCU, and reviewed FGCU's Waller, Weeks and Johnson Rental Index to understand what's behind the shift.

"It's definitely a much more favorable market for renters," Weeks said. "I mean, if you look back four or five years ago, literally, rents were going up at an alarming rate."

The change started with Hurricane Ian. After the storm, Lee County rents spiked to about $2,300 a month as the area faced an extreme rental shortage. Developers responded by planning and building thousands of new units.

A few years later, the market has flipped. Vacancy rates across Southwest Florida are now in the double digits — Fort Myers at 19.3%, Punta Gorda at 17.3% and Naples at 16.4%. Rents are falling in all three markets.

"As the vacancy rate has gone up, the asking price has fallen, and also the effective rent has fallen," Weeks said.

In Fort Myers, annual rent growth is down 3.6%, with the average asking rent about $1,700 a month. Fort Myers has more than 43,000 apartment units and another 1,800 under construction. More supply means landlords have to work harder to fill those units.

Sometimes that doesn't show up as a lower price on the sign. "Most landlords are trying to keep the asking rent relatively stable, but then they're adjusting the effective rent by giving additional incentives to get folks to move in," Weeks said.

Those incentives can mean a month, two or even more rent free. FGCU's rental index shows Fort Myers and Cape Coral rents are now about 10% lower than what would normally be expected based on historic rental growth.

Fred Newman, a local realtor, watched his son struggle to rent out his Fort Myers townhome after it wouldn't sell. After getting married, having a baby and deciding to move away, his son put the home up for sale. About a year later, there was still no buyer, so they decided to rent it.

"They kept lowering the rental until they could attract somebody away from the apartments," Newman said.

Newman says private property owners have to compete with apartment complexes offering months of free rent. "It's a combination that makes it a buyer's market and almost a renter's market, because you're going to get a good deal one way or the other until demand exceeds supply," Newman said. "It's that simple."

Weeks says renters have more power right now, but don't expect it to last forever. "The good news for renters is that now they're getting a pretty good deal, and they should enjoy it while it lasts," Weeks said.

Weeks expects oversupply to start easing over the next year and rent prices to eventually start inching back up.