The South Florida apartment market is in full recovery mode: Rents are up (2.7% year-over-year in metro Miami, according to Zillow), and so are occupancies. The local economy is creating jobs, and new developments are under way. For-sale housing is also bouncing back, but Zillow chief economist Stan Humphries tells us conditions still bode well in the near and longer term for apartment demand in South Florida--with a few caveats. Theres a lot of apartment supply coming on line in the next few years, but demand will continue to fall heavily on the rental side, because a lot of people still have impaired credit, and the Gen Ys are still less than sanguine about buying a place to live, Stan says. (They need to save their money for Apple products and outdoor music festivals.)

One thing working against rental demand is that for-sale housing is still more affordable in South Florida than it has been historically, but that isnt a strong enough headwind to derail apartment demand. Besides, Stan says, even thats going to change in a year or two as home prices go up and interest rates rise. Major apartment developers in South Florida certainly seem optimistic about the future of apartment demand, judging by the steady pace of apartment projects breaking ground. Just last week,Related Group broke ground on the 382-unit Flagler Village in Fort Lauderdale (pictured), which will rise seven stories and feature 25k SF of retail. Not long before that, Related started work on the 249-unit New River Yacht Club in Fort Lauderdale.