Miami leads the nation with the highest inflation rate in December

Inflation reaches a record high in Miami, overtaking Phoenix as the US state with the highest inflation rate in December

Miami housing prices reached a new high in December 2022, even when the inflation rates were cooling down in other Metropolitan Statistical Areas across the country. Other states like Phoenix saw a substantial improvement in terms of retail sales and rising consumer confidence. However, Miami's annual inflation rate remained high throughout the month at 9.9%.

Housing costs are contributing to the inflation rate in Miami

The Florida city is currently struggling with an affordability crisis as prices continue to rise alongside rent. According to data from the US Census Bureau, house prices were up by over 9.5% in December, while the number of new building permits in the city decreased by 14% compared to the same period last year. Homeowners and renters are facing financial difficulties as the housing affordability index remains low.

The professor of economics from the University of Miami, Alex Horenstein, says that housing is one of the "largest components of CPI". The picture is even more concerning for renters as the rental vacancy rate is low, and the monthly rent is increasing by more than 5.8% nationwide whereas, in Miami, the increase is over 12.3%.

During the Pandemic, the demand for home rentals has skyrocketed as people look for places to stay during the Coronavirus pandemic, therefore increasing demand on the real estate market and pushing up the cost of housing even further.

Experts advise on how Miamians can overcome the affordability crisis

The rapidly increasing inflation has made it impossible for the people of Florida to allocate a budget for inflation-beating products. Now, more than ever, it is important to focus on a few essentials to save money and become financially independent in the long run. Local experts recommend cutting expenses wherever possible and making smart financial choices to achieve long-term financial goals. Moreover, finding another source to provide extra income is the best way to achieve financial freedom in the long run.

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