The Tampa Bay rental market is facing an affordability challenge, with nearly 10% of tenants unable to pay rent on time, according to local property management expert Lei Cheng. In a recent interview, Cheng discussed how rising costs and declining rental income are straining tenants, property managers, and homeowners.
“Out of the 700 rentals we manage, we have maybe close to 10% tenants, like maybe 70 to 80 tenants that cannot pay the rent on time,” said Cheng, founder of Service Near Realty, which manages more than 700 rental properties in Tampa Bay. After 16 years in IT, Cheng transitioned to real estate in 2018 and rapidly expanded his business from 50 properties in 2020 to over 700 today.
The Tampa Bay rental market has undergone significant changes in recent years. Rental prices have declined 7-8% in some areas compared to last year, placing financial pressure on all participants in the rental market.
Cheng notes that affordability challenges in Gainesville’s rental market are becoming more acute due to widening gaps between income and housing costs. With average rents around $2,400, many tenants struggle to meet the standard income requirement of three times the rent, which translates to a household income of at least $80,000 to $90,000—well above what many local residents earn.
Economic instability further compounds the issue, as even temporary job loss or illness can push households into delinquency. Many renters now rely on fragmented payments, splitting rent into smaller sums paid throughout the month, reflecting broader financial strain in the local housing market.
Payment delays set off a chain reaction across the rental market. Property managers must handle more delinquent accounts, and homeowners with mortgages feel the strain when rent is late.
“We also got the pressure from the homeowner that keeps calling us, ‘where’s the rent? Where’s the rent?’” Cheng said. “Most homeowners purchase homes with mortgages. They need to pay their mortgage by the 15th, otherwise they will get a penalty.”
This creates an ongoing cycle, “once it’s in this loophole, it will impact everybody in this market: the tenants, property management company, and also homeowners.”
For property management companies facing similar challenges, Cheng stresses the importance of effective systems and communication. His company has adopted technology solutions, including mobile apps for maintenance requests and streamlined workflows, to better manage the administrative workload.
Service Near Realty maintains a three-day grace period for rent payments, followed by systematic follow-up on the fourth of each month to quickly identify and address payment problems.
Cheng expects the affordability issue to persist unless there are major changes in the broader economy. “I see this trend will still maybe stay stabilized for quite a few years in Florida, unless the interest rate is significantly reduced,” he said, adding that mortgage rates would need to drop by at least 1% for significant improvement.
