Like all financial choices, investing in real estate is a huge decision.
To help you out in your efforts, I’ve compiled some reasons why real estate investment is smart and why Tampa is the perfect place to start.
Is Tampa a Good Place to Invest in Real Estate?
For many reasons, Tampa real estate is an excellent investment opportunity. Besides being a local and completely immersed in the Florida lifestyle, here are my top four reasons to invest in a Tampa property.
Tampa’s Post-Pandemic Recovery
The city of Tampa has swiftly recovered from the pandemic because its economy is not as reliant on tourism as other cities like Miami and Orlando.
Many Fortune 500 companies across different sectors call the area home, aiding the region’s unstoppable job growth. Plus, Tampa is a major port, so regional trade and distribution further bolster the economy.
With such a diversified economy, this area was able to bounce back faster than any other Florida city. According to the Kenan Institute of Private Enterprise, Tampa’s economy is one of the fastest growing in the nation!
The Tampa, FL, Real Estate Market
Data from Realtor.com shows Tampa was one of the best-performing housing markets last year, and the trend will continue this year. In fact, the National Association of Realtors reported pending home sales in December increased by 2.5%, so we are headed out of the slump from 2022.
Standard home values are still up nearly 18% year-over-year despite a slowdown in the market and rising interest rates. Additionally, the median days on the market in Tampa is 64 days.
If the numbers prove anything, now is a fantastic time to search for and buy a property in the Tampa area.
Attractive Renter’s Market
When the housing market is hot, the rental market is also highly desirable. Many buyers, especially first-time homeowners, cannot compete in a seller’s market when those with more capital can offer better closing terms for sellers.
In Tampa, nearly 50% of households rent, making it an ideal place to purchase an investment property. In fact, at the height of the market, almost 25% of all home sales were to real estate investors. In addition, investors agree there is no concern about finding suitable renters because so many are relocating to the area.
And while rental prices are slowly decreasing, Zillow states that the average rent in the metro Tampa area is still up 8.5% from last year. The current average median rent is around $2,250.
What if you want to get involved in Tampa real estate investing and not deal with the hassle of being a landlord? Luckily, many reputable property management companies can assist with your rental property. You won’t have to worry about handling a thing. Just sit back and watch your investment appreciate.
Housing Affordability
Although the housing market has been volatile across the U.S. for several years, Tampa has remained one of the most affordable urban areas.
Median sales prices in Tampa are on par with average prices around the country. As of December 2021, Realtor.com put the average listing price in Tampa at $410,000, compared with $440,000 nationally.
Further, the area has an affordability index of 5 out of 10. This means the market is mid-range. It explains the hot rental market and why average home prices remain considerably low.
Why Tampa?
If I haven’t convinced you yet, take a look at why new residents love the city and moved here in the first place. Florida’s population growth just hit a historic high in 2022 since the peak of the baby boom in 1957!
Job Market
In 2021, the Tampa area (Tampa-St. Petersburg-Clearwater) gained the most private sector jobs of all Florida metro areas. Significant sectors of the economy continue to see growth, including:
- Construction
- Financial services
- Leisure and hospitality
- Professional and business services
Additionally, as of November 2022, the unemployment rate was 2.6%, well below the national average of 3.5%. Experts say job growth is still on an upward trajectory and will not slow soon.
Quality of Life
Tampa residents note the quality of life is nearly unbeatable. With a strong economy, seemingly perfect weather, and a reenergized urban core, it’s no surprise why Americans from all over the country continue to flock to Tampa.
Tampa also has lower healthcare costs than other metro areas. Healthcare is one of the most significant financial stressors for American families, so any savings are beneficial and improve the quality of life.
Fast-Growing City
Tampa is a bustling city. In truth, it’s the fastest-growing city in all of Florida. Just imagine the possibilities!
More people are moving to Florida, whether it’s to start their lives after college, for a new job, or for retirement. Having a strong student population means young professionals are putting down their roots here right after graduation. And our warm climate means people stay here long after their careers wind down.
All of this steady growth means that even more businesses will pop up to make life easier and more convenient for Tampa residents.
Even with single-family or multi-family homes, this growth is helpful. The cost of living is already lower than the national average, as are the sales and income tax rates. The Tampa market will continue to draw in more and more people.
Overall, it’s a great place to find a property that will increase in value over time, all while saving some money due to the healthy economy and lower costs. Having additional people move into the city will only continue to make housing more desirable as time goes on.
Culture
In this city, both single-family and multi-family investments are booming. Many people are making a move from multi-family homes, like condos and townhomes, to single-family homes.
This makes for diverse neighbors in a city that is already very ethnically and racially diverse, giving Tampa plenty of rich cultures. This diversity further expands the attractiveness of the city as a place to live, meaning that there will always be people looking to move to the area.
Family Friendly
Tampa is a great, safe location to live in and perfect for raising families. The city offers good schools, and there are also numerous parks, libraries, and family-friendly activities. This is a great selling point for families if you hope to rent or sell.
Area Attractions
With the Gulf and its many beaches, numerous theater and dining options, universities, and more, the Tampa Bay area offers residents plenty of things to do, like visiting Busch Gardens or the Florida Aquarium. This helps keep the real estate market healthy. Whether you are talking about the trendy eateries and shops of Tampa or the scenic views of Bayshore Boulevard, there’s a little something for everyone.
Has the Tampa Housing Market Stabilized Yet From the Pandemic?
Generally, yes, prices are stabilizing. This is excellent news for homebuyers.
While bidding wars still occur, they aren’t as frantic as they were at the height of the housing boom in 2021. An increased supply of homes, new construction, and the cooling economy have helped stabilize prices.
However, this doesn’t mean the housing market has returned to pre-pandemic levels. Due to many economic factors, the Tampa housing market will continue to stay elevated. Prices just won’t rise as quickly as they were rising before.
When Will Tampa Home Prices Drop?
Experts say new home prices in Tampa and throughout Hillsborough County will not decrease in 2023 or for the next several years. Rather, the latest real estate predictions suggest house prices will continue to climb steadily, albeit slower, than in the last two years.
Many say prices will go up further before they start to trend downward. This is because the current housing supply is insufficient to meet the demand. When a housing market is as in demand as Tampa is, it takes several years for new construction to create enough inventory to meet the demand.
Since inventory will take several years to catch up, home sales will continue to boom. I spell out the 2023 market forecast here – Tampa is and will continue to be, one of the hottest real estate markets.
Ready to Get Started?
So, is Tampa an excellent place to invest in real estate? It sure is!
Working with a great Tampa real estate agent is one way to make the process smoother and ensure you have all the details you need before purchasing a property. I can help you quickly find a property, negotiate, and achieve your dream of a solid investment in a beautiful state.
If you are ready to buy, let’s talk! I’ve lived in Tampa my entire life and can share a wealth of knowledge in navigating the real estate market to help you find your dream home or the perfect investment property.