While the impact of the latest fed rate increase on the real estate market won’t be clear for another couple of months, news about Q1 is making waves. The National Association of Realtors’ (NAR) latest quarterly report showed double-digit home price increases across 70% of the 185 US metro areas they measure. During Q4 2021, only 66% had seen such increases.
Five of the top ten areas with the highest year-over-year price increases are here in Florida:
1. Punta Gorda (34.4%)
2. Ocala (33.8%)
4. Lakeland-Winter Haven (30.1%)
6. Tampa-St. Petersburg-Clearwater (28.8%)
8. North Point-Bradenton-Sarasota (28.0%)
Florida is also home to the ninth-most expensive metro area, Naples-Immokalee-Marco Island ($745,000; 24.3%).
As you can see, Tampa home prices saw an increase of almost 29% during the first quarter of 2022 when compared to the same time last year. While Florida’s population growth is likely driving some of the price increases, low housing inventory and supply chain woes have helped to escalate the rate of increase as well.
With another quarter of increases, are home prices finally ready to remain steady? Lawrenece Yun, NAR’s chief economist, predicts, “Given the extremely low inventory, we’re unlikely to see price declines, but appreciation should slow in the coming months.”
Mortgage rate increases may also serve to slow down the rate of home price increases. The Fed recently passed its second increase of 2022. The 0.5% was the largest increase in 20 years. While the Fed is attempting to slow down inflation, it will also likely have an impact on both buyers and sellers.
Right now, home price increases have made it exceedingly difficult for first-time buyers to find affordable homes. When combined with mortgage rate increases, NAR estimates that a typical mortgage payment on a 10% down loan went up by 30%.
To learn more about how recent real estate news may affect you, get in touch. Whether you are looking to purchase a home or sell a property, I can help you better understand the current Tampa real estate market so you can make your real estate goals into reality.