The Tampa Bay real estate market remains hot. While many cities have seen a slowdown in real estate sales due to the pandemic, Tampa Bay has largely remained unaffected. People are gravitating away from larger cities like Chicago and Los Angeles and are interested in what Tampa Bay offers. Currently, Tampa Bay is ranked in the top 10 hottest housing markets by PwC and Realtor.com. In 2022, the market is only expected to increase competition and housing prices.
Cost of Living
Tampa’s cost of living has drawn the attention of people across the nation, many of whom are interested in changing their location due to the increase of flexibility with working from home. Compared to New York or San Francisco, Tampa has a much more affordable cost of living. Workers wonder if they can work from home anyway, why not live in a more affordable city. Also, Florida does not have state income taxes, which appeal to workers wanting to keep more money in their accounts. However, as homes become more expensive, living costs also increase. Tampa’s cost of living could be much higher in the coming years.
High Demand for Housing
This attention has led to strong demand for homes in the Tampa Bay area. Retirees and young professionals alike are entering the market, looking for a home. This makes for a competitive market where the demand exceeds the supply, causing a shortage of homes and higher housing prices. Tampa Bay is a seller’s market.
However, with current low mortgage interest rates, sellers have an incentive to jump into the market and put up their homes for sale. The likely increase in mortgage rates to combat inflation may not immediately affect the hot housing market in Tampa, but it should help stabilize house prices in the area.
Single-Family Homes
The most in-demand real estate is single-family homes. Professionals and their families are seeking to relocate to the Tampa area. They recognize the appeal of Tampa and its economic benefits and the long-term investment benefits of owning a home. According to the Zillow Home Value Index, homes in the Tampa area have appreciated almost 175%. As the market continues its competitive trend, this appreciation rate is only expected to increase. Based on data compiled by the Greater Tampa REALTORS, single-family homes in the Tampa Bay area sold at an 8.3% higher rate than this time last year.
Increase in Housing Prices
As noted, housing prices are rising and should continue to grow throughout 2022. Tampa housing prices have increased by 21.4%, according to Florida REALTORS. The current average sale price for a home in the area is now $446,224. This sale price is out of the range for many Tampa residents, yet real estate agents are getting sales finalized at a faster rate than in 2021. People recognize the hot market trends and are trying to jump into the market before the average median price goes even higher.
Another consideration is the supply chain disruptions affecting the United States and many other countries. As building materials such as lumber become more challenging to attain, the material’s cost will go up. Then, as the cost of building increases, the overall price of homes will follow.
Median Home Price
Like the average home price, the median home price is also rising. Based on the same Florida REALTORS report, the median sale price is now $362,250, a 25% increase in the last year. This shows a sharp incline in living costs in the Tampa area. If the cost of living continues to increase at this rate, the Tampa Bay Region will have to decide how best to meet the housing demand.
Overall Forecast for Tampa Bay
The hot real estate market is and will remain a seller’s market. Nonetheless, if you are a buyer, the current mortgage interest rates are the lowest you will see in the coming years, so buying soon may be to your benefit. People recognize Tampa’s fabulous beaches, weather, school districts, and more. As these people come to the region, the supply of homes will only become more restricted.
