Miami Beach / South Beach

Miami Beach / South Beach remains a stable but fully-priced multifamily submarket in Miami-Dade County. Cap rates have compressed to 4.8%-5.3%, reflecting strong demand but limited upside for new investors. Average rents of $3,400/month and 60% five-year appreciation tell the story of a market that has already run significantly. Rent growth at -1.2% suggests the upward momentum is decelerating.

The expense side is where Miami Beach / South Beach demands close attention. Insurance costs run approximately $2,800 per unit annually, rated VERY HIGH risk due to the VE (Muy Alto) FEMA flood designation. Combined with a millage rate of 14.47 and operating expenses that typically run 40% of gross rent, investors need to model total expenses carefully to avoid overestimating net returns. Property taxes average $4,500 per unit per year in this zone.

With a population of 92,000 residents and a median household income of $58,000, Miami Beach / South Beach generates substantial organic demand for rental housing. The zone scores 82/100 for walkability and B for safety, with schools rated B. Current vacancy stands at 8%, roughly in line with the county average. Limited new construction (0 units in pipeline) helps protect existing property values.

For multifamily investors evaluating Miami Beach / South Beach in 2026, the entry point ranges from $350K to $450K per unit. Insurance is KILLER ($2,800/unit). Sea level rise = long-term risk. Rents declining. Low millage but insurance more than compensates. Investors comparing this zone against the broader Miami-Dade market should weigh the 4.8%-5.3% cap rate against the county-wide range of approximately 3.8% (Key Biscayne) to 7.5% (Florida City), and factor in the significant variation in insurance and tax burden across the county's 34 investable zones.