The past year has seen a surge of sales in the Tampa luxury home market. This year, our city has been named the hottest market by Zillow, so do not expect things to slow down!
If this is coming as a surprise to you, don’t worry. In this post, I will be sharing some of the reasons that Tampa real estate is hot so you can have greater insight into the area before buying or selling a home here.
Why Did Zillow Name Tampa the #1 Real Estate Market?
Here is a surprising stat: 16% of all home sales in Florida in 2021 were in Tampa. There is no denying that it is a hot market. But why is it so popular right now? Here are three possible reasons that Tampa real estate is on the move.
The People
It is safe to say that Florida is an attractive place for folks looking to retire. The temperate weather and accessibility of Tampa helps keep us at the top of the list. With more Boomers leaving the workforce, we are seeing an increase in Boomers looking for homes in Florida or moving from larger homes to smaller condos that are easier to maintain.
Similarly, Millennials are beginning to purchase their first homes or upgrading to larger homes for their growing families. The Tampa area has great schools, great jobs, and amazing recreational opportunities. It is no surprise that our population continues to grow!
If you are in a position where you are looking to upgrade or minimize your space, let me know. We can work together to find you the perfect next home or condo.
Job Growth Accelerating
At the beginning of the pandemic, most metropolitan areas suffered major job losses as restaurants, hotels, and tourist hot spots laid off employees while shuttering their doors or reducing their capacity. While many areas have made strides in welcoming those workers back, unemployment remains high. Thankfully, in Tampa, job growth continues. One interesting metric that measures job growth in regards to new construction indicates that Tampa has added a new job for every 0.63 of a new unit built.
#1 in Price Growth
In 2021, Tampa was #4 in home price growth. That means that home prices in the area grew at a higher rate than it did in other metropolitan areas. So while other markets may have had more expensive homes overall, Tampa’s home prices were higher by a larger percentage than other markets. Some months in 2021 saw record price growth of over 20% year-over-year! Zillow is predicting that this year, Tampa will take the top spot for price growth. This, of course, has its pluses and minuses. For sellers, this is a boon. There is still time to sell and take advantage of the pandemic real estate market growth. For buyers, this means you need to be financially prepared for prices that are substantially higher than they were just two years ago.
It Is Florida
We cannot ignore that one of the reasons so many people want to live in Tampa is that we are in Florida. Beyond the gorgeous weather and beaches, we live in a state that has no state income tax. This is attractive both for retirees who are trying to make the most of a fixed income and for hard-working Americans who want to enjoy their paychecks and live well in a gorgeous area.
What Is Next For the Tampa Real Estate Market?
With International buyers returning to the scene and Millennials looking to buy their first homes, there is plenty of competition in the area. Yes, the Fed has indicated that it will be raising rates. And yes, this will likely drive mortgage rates higher. However, because of low housing inventory, there are still plenty of people who have not been able to find a new home. Maybe they have been outbid or perhaps they just did not see an interesting listing quickly enough to get an offer in. Whatever the case, there is a large group of potential buyers just waiting for the right opportunity. Is this finally their year?
Tampa New Home Construction
New home construction is picking up after suffering from supply chain issues and high demand at the start of the pandemic. HBW, which publishes data about new home construction permits, shares that the Tampa area had 1,929 new residential construction permits on record in December 2021. While it will take several months to get those projects live-in ready, that is a lot of new housing in our area! Pasco and Polk Counties had several hundred new permits in November, taking the second and third spots for permits by county.
Even with an increase in home construction costs, there is no indication that new home construction will slow.
Tight Inventory
All of those beautiful new homes take time to build so, unfortunately, we will continue to see low housing inventory for the foreseeable future. Once more new homes hit the market and more sellers list their homes, we may have a more balanced inventory that takes some stress off of buyers. Right now, we cannot count on that, though.
If you are in the market for a home in the Tampa area, waiting is not your best bet. If you want to be the first to hear about available properties and increase your chances of submitting a winning bid, you need to connect with a reputable Tampa Realtor today. Contact me and let’s talk about what you need in a home so we can work together on making that dream a reality.