THE 1% RULE SNAPSHOT · 🏆 Karim's Top 3 Multifamily Picks

Rate: 7.47% | Down: 25% | Expenses: 35%

🏙️ Karim's Top 3 Condo Picks

Rate: 7.47% | Down: 25% | HOA, taxes and insurance billed separately

📈 The Fed Just Raised Rates for the First Time in Three Years

Photo: Pexels

On Wednesday the Federal Open Market Committee raised the target range a quarter point, to 3.75 to 4.00 percent. The vote was unanimous, twelve to zero, and it took effect Thursday. It is the first increase in more than three years.

So why raise rates when everyone spent two years waiting for cuts? Because inflation never finished the job. August consumer prices came in up 3.4% over the year, the statement says inflation "remains elevated," and the Committee wants what it called "a timelier return" to its 2 percent goal. The labor market gave it room to move, since job gains kept pace with the workforce and unemployment barely budged. Chair Kevin Warsh put it more bluntly to NPR: "The responsibility for 65 months of sustained, elevated inflation sits squarely with the central bank."

Your lender did not wait for the paperwork. Freddie Mac printed 6.95% on the 30-year Thursday morning, up from 6.76% a week earlier. That is a 19 basis point jump in a single week. On a $500,000 note it costs you about $63 a month, roughly $761 a year.

The number worth your attention is not this week's rate. It is the projection table the Fed released the same afternoon. The median forecast puts the federal funds rate at 4.1% at the end of 2026 and 4.1% again at the end of 2027, easing only slightly the year after. Read that as an implication rather than a promise, because the Fed publishes medians and not commitments. But if you have been sitting on a fourplex waiting for money to get cheaper, read that line again. The institution that sets the price of money does not expect it to be much cheaper fifteen months from now.

One caution before you run your numbers. The headline rate is not your rate. Freddie's 6.95% is a weekly average of conforming owner-occupied quotes, and a two to four unit investment loan prices above it. HousingWire had daily conforming loans at 7.28% on September 15. That gap is worth about $25,500 of purchasing power on a half-million-dollar loan, and it runs in the direction that costs you.

Locally, the market was already cooling before any of this. MIAMI REALTORS reported 1,769 Miami-Dade home sales in August, down 1.1% year over year, which by our reading ends a run of eleven straight monthly increases. Active inventory fell 12.1% at the same time, with single-family listings down more than 19%. Supply shrinking while demand softens does not produce a crash. It produces a market that stops clearing, which shows up as longer days on market and less room to push an asking price.

🧠 What It Means: For buyers, the waiting thesis just lost its timeline, so underwrite on today's number or walk. For owners, a slower market plus a higher cost of capital means your exit takes longer than it did in July.

💰 Three Counties Held Their Tax Rate Flat. Your Bill Went Up Anyway.

Photo: MMM photo library

South Florida just finished budget season and the scoreboard is unanimous. Miami-Dade commissioners adopted a $14.26 billion budget around 5 a.m. Friday with the countywide operating rate held at 4.5740 for a fourth straight year. Palm Beach County adopted its own budget at a flat 4.50. Fort Lauderdale held at 4.11 for the nineteenth consecutive year.

So if nobody raised the rate, why is the county collecting more? Because the rate was never the part doing the work. Miami-Dade's own budget documents show property tax revenue rising $120.7 million on an unchanged rate, because assessed values went up underneath it. Fort Lauderdale's budget director put the homeowner version on the record: on the city's average single-family value of $640,000, the bill rises about $180 a year purely from assessment growth.

Here is where it lands differently for you. That $180 example describes a homesteaded house, whose assessment increase is capped at 3% by Save Our Homes. Your rental has never had that cap. A non-homestead two to four unit is limited only by the 10% cap, which is exactly the provision Amendment 3 would cut to 5% on November 3rd. Same flat rate, two very different escalators, and only one of them is the slow one.

There is also a fourth tax line coming, and it is the one no cap touches at all. Miami-Dade and Broward voters both decide on November 3rd whether to renew a one-mill school property tax for four more years. Axios reported Friday that a bipartisan coalition is campaigning for the Miami-Dade renewal. Broward's own referendum page puts its version at roughly $358 million a year. That is about $418 annually for the average homeowner and $230 for the average condo owner. NBC 6 reported that both counties are asking the same question.

One mill is $1,000 a year for every $1 million of taxable value. Florida's 10% cap on non-homestead assessments applies to all levies other than school district levies. So on a duplex or a fourplex, the school levy is charged against full just value with no cap in front of it. Amendment 3's larger homestead exemption does not reach it either. Worth checking the statute before you act on it, but that is the rare line on your TRIM notice with an up-or-down vote attached.

🧠 What It Means: For owners, model 2027 both ways, because a flat rate is not a flat bill and the school line is not capped. The City of Miami is the last rate still unset, and its final hearing is Thursday, September 24 at 5:05 p.m.

🌀 Citizens Has Shed a Third of Its Book This Year

Photo: MMM photo library

Citizens Property Insurance publishes its policies in force every month, and the 2026 series is remarkable. The book went from 392,689 policies on January 31 to 266,231 on August 31. That is 126,458 policies gone, about a third of the company, in eight months.

Does any of that actually help you at renewal? It might, and the reason is mechanical rather than hopeful. Depopulation means admitted carriers are actively taking on risk that Citizens was holding in January. If an agent told you two years ago that Citizens was the only market for a 1960s CBS fourplex, that was probably true then and is worth retesting now. A takeout offer arriving in your mail is closer to normal than to unusual at this point.

Three honest caveats, because this is insurance and the fine print is the product. Citizens publishes one combined figure across all lines, and it does not split personal residential from commercial residential or dwelling fire, which is where most two to four unit rentals actually sit. So the total book fell by a third. Whether landlord policies specifically fell by a third is not something the number can tell you. Leaving Citizens is also not automatically cheaper, since a takeout can carry a different hurricane deductible or a roof schedule that costs you later. And the trend is slowing down, not speeding up: February alone shed more than 56,000 policies, while July and August together shed about 12,000.

Bottom line: If your last non-Citizens quote is more than a year old, you are shopping on stale information. Re-shop before renewal, and read the deductible before you celebrate the premium.

🌳 The City Is Coming for Your Hedge

City of Miami code enforcement has been escalating its use of sight-visibility rules against private landscaping, according to Coconut Grove Spotlight. The code sets "visibility triangles" at driveways and intersections where vegetation, fences and walls between two and a half and ten feet high may not block sightlines. One Grove property owner got notices starting in February, a formal violation notice on August 26, and a compliance deadline of September 25.

This is not a new rule. It is new enforcement of an old rule, which is the version that catches people. Every two to four unit building in the city has a driveway and most of them have something growing next to it. The cost is rarely the pruning. It is that a violation notice starts a clock measured in weeks, and an open code case has a way of surfacing in the middle of a refinance.

Cheap thing to do this weekend: stand at the end of your own driveway and look left.

🎉 What's Happening in Miami

Photo: MMM photo library

Two worth your Sunday, and one of them is happening while you read this.

Inter Miami hosts San Diego FC tonight at 7 p.m. at Miami Freedom Park. It is the first meeting ever between the two clubs, and an early test of getting in and out of the new stadium on a Sunday. Tickets here.

Miami Spice is still going, and this year it turns 25 and picked up an extra month, so it runs through October 31 instead of ending with September. Three courses go for $40 at brunch and lunch and $50 to $65 at dinner, across more than 300 restaurants. Full list here.

Until next time. If you know somebody who is still waiting for rates to come down before they buy, forward this to them. The projection table is the whole argument and it takes about thirty seconds to read.

Reply to this email with an address if you want me to run the numbers on a specific building. I will send back the 1% math and tell you honestly when it does not work.

Karim Samy Real Estate Agent d. 407.405.2969 [email protected] karimsamy.keyes.com

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