Tampa Bay Market Trends | Buyers Market | Future outlook increased prices and sales.
Tampa Bay Market Trends
Future outlook increased prices and sales
Tampa Real Estate Market Trends
By Patrick Mckernan December 2018
The city of Tampa is considered the economic center of Western Florida. Nestled deep in an inlet that reaches into the west coast of Florida, Tampa has a lot to offer both tourists and residents. Most people think of Busch Gardens, the massive amusement park and zoo all in one place; However, downtown Tampa has historic old quarters, such as the Tampa Theatre on Franklin street where you can enjoy a special mix of architectural styles. Built-in 1926 there is no better place to watch a classic film. With all this to offer, it’s not surprising that Tampa’s real estate market has remained strong.
Tampa Bay Real Estate Current Trends
Looking at some data from the last quarter of 2018 we might conclude that there exists a slight shift towards a buyers market in Tampa.
In her October article for the Tampa Bay Times, Susan Taylor Martin quotes Charles Richardson, a Senior Vice President at Coldwell Banker:
“Inventory has grown over the last couple months so opportunities for buyers in today’s market are very, very strong.”
Susan Taylor Martin notes a sales increase as compared to September of 2017.
These percentages are surprising considering the national average for sales in September was a decrease of 4.1%.
In October the increase in sales continued. Sales as a percentage compared to October 2017 for the entire Tampa area including all four areas in the above chart was 9.9% -Source Greater Tampa Realtors. According to their Economist:
“Closed sales are one of the simplest - yet most important indicators for the residential real estate market. When comparing Closed Sales across markets of different sizes, we recommend comparing the percentage changes in sales rather than the number of sales. Closed Sales (and many other market metrics) are affected by seasonal cycles, so actual trends are more accurately represented by year-over-year changes. (For example, comparing a month’s sales to the number of sales in the same month in the previous year). Rather than changes from one month to the next.”
Tampa Bay Real Estate Market Outlook 2019
According to Zillow.com: Property values in the sought after Tampa areas have seen steady moderate increases. Looking at the average median home price for a 3 bedroom single family home in some of the hottest Tampa areas as of November 2018. Prices are just above the National Median home price for 2017 which was $187,000. Historically over the past few years, the property values in Tampa have been rising along with increased sales. The 1 year Sales price forecast is more of the same. New Tampa is expected to rise 5.4%, Wesley Chapel 3.5% and Riverview is forecast to see a significant 7.8% increase.
The prospects for investors are looking just as positive from a historical perspective as the median monthly rents in the Tampa area have been well below the National median rents for an equivalent 3 bedroom single family home.
This is all welcome news for Tampa buyers who, according to the Tampa Bay Times, just this past June were looking at a housing shortage and a 6% increase in housing prices in all four Tampa counties over the prices of June of 2017.
Moving forward, it may be possible to extrapolate some predictions by looking at some of the market trends leading into the final quarter of 2018. Considering the November data taken from a more recent Tampa Bay Times Article by Susan Taylor Martin, published on December 19. Martin observes that the supply of available homes both locally and nationally continued to increase. This trend could lead to greater affordability. Martin quotes Lawrence Yun, Chief Economist of the National Association of Realtors who stated:
“Rising inventory is clearly taming home price appreciation”
Let’s consider the Numbers below. Two of the four Tampa counties saw significant price increases and clearly could use more “taming”. The other two counties saw more moderate price increases over the same month last year.
The median prices of a single-family home below also show Pinellas county at the top end.
The percentage increase or decrease of closed sales is a strong litmus test of basic micro-economic axioms as suggested by Lawrence Yun. Here we see as prices in Pinellas County rose sharply the buyers held back and sales were lower than the previous November. Hillsborough with only a moderate price increase had a nice increase in sales. Clearly, potential Pinellas County buyers had other options to consider.
Hottest Real Estate Markets In Tampa 2019
Considering the above numbers it appears Hillsborough County is the hottest Metro Tampa market heading into 2019. According to Gord Collins in his Florida Housing Forecast, the whole Tampa/Sarasota housing market is hot and will remain so for the next couple of years. The Tampa area ranks 6th in loan applications from those ready to move. Zillow reports the property prices have risen 14.7% year-over-year and predicts they will continue to rise 9.7% over the next 12 months. If you are a prospective buyer in the Tampa area there is no reason not to get into the market now as prices are expected to continue rising over the next 5 years. Although Tampa had a great 2018 with a strong economy 2019 is looking like it could be just as good or even better.