Why Miami is flunking homebuilding and affordability while the rest of Florida booms

While Miami continues to attract deep-pocketed transplants and institutional capital from across the globe, beneath the surface, the city’s housing market is failing on two key fronts: new construction and affordability.Dotted with palm trees and bristling with amenity-rich luxury condominium towers, “Magic City” earned the dubious distinction of being 1 of 13 major U.S.metros to receive an F grade in the newly released 2026 Realtor.com Metro Report Cards.Out of a possible 100 points, Miami earned an overall score of just 29, weighted down by a lackluster affordability component score of 18.9, combined with a slightly better homebuilding component score of 39.1.For context, best-in-class Des Moines, IA, which received an A+ in the ranking, earned a total score of 83.4, propelled by affordability and homebuilding component scores of 88.3 and 78.4, respectively. Although Miami is not the worst-performing market in the nation, with Los Angeles comfortably claiming that title, it nevertheless holds a unique distinction: It is the sole failing metro located in a state that earned a passing grade on the Realtor.com State Report Cards.“We gave the whole state of Florida a B, but Miami behaves differently, with many more restrictions on geographic expansion than other metros in the Sunshine State given the Everglades to the west and the Atlantic Ocean to the east,” says Realtor.com senior economist Joel Berner.Experts agree that when it comes to new construction, land scarcity is Miami’s Achilles’ heel relative to the rest of the state.“There isn’t much room for Miami to grow except up, which is why we see a large share of condos on the market there generally and a large share of luxury condos in the new-construction space,” says Berner.This severe land constraint directly dictates the economics of residential development in Miami.“Land is expensive, construction and labor costs are high, financing is still costly, insurance has become a major expens...