08.8.2023 PropStream
Despite the general slowdown observed in the U.S. housing sector since last fall, the Tampa Bay market has remained strong. Population growth, a robust employment landscape, and limited housing availability have contributed to the local market’s competitiveness. As a result, Tampa Bay is witnessing an appreciation in property values.
In 2022, the Tampa housing market was characterized by a surge in home prices fueled by limited supply. This year, the market remains essentially unchanged, with home sales remaining consistent. Although rising mortgage rates have dampened the Tampa market, as they have across the country, they haven’t been able to bring down housing prices. Demand remains high as there are still more potential buyers than available houses.
While the real estate market in the eastern part of the country follows a similar trend to that of Tampa, the situation in the western region is different. Home prices are still rising on the East Coast, but they’re starting to decline in the West. This disparity can be attributed to homebuyers migrating to the East in search of a more affordable lifestyle.
Although the overall U.S. real estate market has been booming in recent years because of the pandemic, local markets are readjusting, with increased volatility experienced in coastal regions.
What To Expect From the Tampa Bay Real Estate Market in 2023
Tampa has a strong reputation as one of the best places for lucrative long-term real estate investments in the U.S. According to Mashvisor, home values in Tampa have appreciated by an impressive 9.22% since September 2022. As demand is high and inventory is expected to remain low, property prices will likely continue to rise throughout 2023.
Currently, the average home value in the Tampa Bay region is up just a couple of percentage points from last year. However, the scarcity of available homes in Tampa has created a situation where buyers are compelled to compete, resulting in elevated prices and accelerated sales. The demand for homes exceeds the available supply, giving sellers an upper hand in price negotiations over potential buyers. Here are three noteworthy trends to monitor in the real estate market of the Tampa Bay area:
Days on the market are longer than last year
As in many markets across the country, homes are staying on the market much longer than before. Homes sold in 49 days on average in March, compared to 17 days this time last year.
Homes are selling for slightly more than last year
As of March, the median home price in Tampa Bay was $380,000, marking a 1.9% increase year-over-year. Although it’s not a major increase, it’s still significant given the current state of the housing market across the U.S.
The housing supply is growing but remains relatively low
Housing inventory is growing significantly, up 136.5% year-over-year, but this is still the lowest it's been since June 2022. For the market to shift towards buyers, the number of homes for sale would need to increase to 3-4 months' supply. The current housing supply in Tampa is at 2.4 months.
Why Invest in Tampa, FL Real Estate?
Tampa is one of the best locations for buying rental property in all of Florida. Rising rents, a strong economy, and regular tourist activity make Tampa a great place to invest. Take a closer look at the top three benefits of investing in Tampa Bay real estate:
Rising Home Prices & Rents
Although property prices are on the rise in Tampa, they remain relatively affordable compared to other real estate markets across the country. Now is a great time to invest if you’re interested in a buy and hold strategy. Investors can capitalize on Tampa investment properties by renting them out now while rents are high and selling them at a higher price once their home value has appreciated further.
It’s best to focus on emerging markets. Cities such as Sarasota and Largo offer great investment opportunities for investors looking to jumpstart their rental property portfolio. As for the Tampa Metro Area, a handful of popular neighborhoods are considered the fastest-growing rental markets: South Bradenton, which has experienced a remarkable 40% increase in rent compared to this time last year; Lutz, where rent has climbed by 38.3%; and Winter Haven, which ranks third with a notable 28.9% rise in rental rates.
Tourist Attraction
Downtown Tampa offers a relaxing experience for tourists with its plethora of natural parks, notable landmarks, captivating museums, and diverse restaurants. The surge in tourism has had a positive impact on the short-term rental market, providing unique opportunities for landlords. Additionally, the city boasts a favorable climate, allowing attractions to be enjoyed throughout the year. As a result, investors in the short-term or mid-term rental market don’t have to base their rental businesses on the seasons. Instead, they can generate rental income consistently year-round.
Booming Local Economy
An abundance of job opportunities has also had a positive impact on the housing and rental markets. Tampa stands out as one of the fastest-growing emerging job centers in the country. Four Fortune 500 companies are headquartered in Tampa, making it an attractive place to call home for singles and families.
Tampa's economy is highly diverse, with significant contributions from sectors such as financial services, STEM (Science, Technology, Engineering, and Mathematics), healthcare, research, education, tourism, beaches, and military bases, all of which play substantial roles in job creation and overall economic growth.
Given its cost-effective work environment, Tampa also attracts a significant number of entrepreneurs and small businesses, which help strengthen the local economy even further. Securing residential spaces becomes a primary concern for these professionals as they arrive in the city. They’re often looking for homes located in close proximity to downtown.
Identify Unique Investment Opportunities With PropStream’s Lead Generation Technology
Finding the best deals in competitive markets like Tampa can be a stressful, time-consuming task. Although homes are not selling as quickly as they were last year, they’re still going pretty fast, averaging just 31 days on the market. Time is of the essence when investing in the Tampa area.
Luckily, PropStream’s real estate lead generation software can help savvy investors locate their ideal investment property in a timely manner. Using advanced filtering capabilities, investors can target Tampa investment properties and make practical use of real estate data—all within one convenient platform.
Sign up for a 7-day free trial to find out why real estate investors across the country trust us with their real estate lead generation.
