Rising rents in Tampa leads to home buying. Here’s why.
As apartment prices in the Tampa Bay area keep shooting up and getting more expensive, city leaders have launched an aggressive – and creative – program to convince struggling renters that they have another option that may be even more affordable: becoming homeowners.
And the fact that rents continue to go up as the city’s economy gets stronger may be helping their case.
Right now, the median rent for a two-bedroom apartment in Tampa is $1,500. But in some popular neighborhoods like downtown, rents are far exceeding that amount, forcing some tenants to keep relocating in the hope of finding something more affordable, which can be a challenge.
City leaders understand their plight – and now are ready to help.
The city of Tampa held a special event in Ybor City in June for prospective home buyers, with a particular outreach to people who might not have thought of themselves as being likely candidates to buy a home. The city’s message to them was: You might be surprised to learn that’s not true.
The city’s goal was to convince many of these renters that owning a home could actually be cheaper in the long run.
Because one thing city leaders have long believed is that Tampa benefits every time someone buys a home in the region. Homeownership helps make cities better places for everyone who lives there since homeowners tend to devote more time to keeping their property up and investing in it.
Why Did Tampa Leaders Hold a Meeting on Housing?
The special event was educational, letting buyers know that there’s help out there if they didn’t think it was possible to ever afford a home.
In all likelihood, despite the high cost of renting, some tenants presume that they’re priced out of the housing market because they’ve read about how home prices are increasing. Some tenants might also assume they need to put down a sizable down payment that they don’t have.
That’s why this event matched prospective home buyers with representatives from banks, area non-profit agencies that provide credit counseling services, and programs that offer down-payment assistance.
And one of the messages from the event was that it was possible for renters to buy a home, and then lock in a fixed mortgage rate that allows them to make the same monthly payment — for years. There are no “rent increases” applied to the mortgage payment.
And in many instances, a mortgage payment can amount to less than what some tenants are paying for their apartment each month.
But that’s one reason why the city invited bank representatives to attend and to talk about programs designed for first time home buyers.
At the same time, city officials have another strategy they’re working on: to increase the number of affordable homes for sale in Tampa, by partnering with private developers to create about 140 new houses geared toward first time home buyers.
What is the City’s Strategy for Helping Prospective Buyers?
The median price of homes currently listed in Tampa is $319,000, while the median price of homes that sold is $210,100, well below the sky-high prices in cities like Los Angeles, New York, Seattle, and San Francisco.
But inventory has been a challenge in Tampa as well as most other cities across the country. That’s why Tampa city leaders have reached out to a major builder, Domain Homes, one of the developers constructing homes that cost $200,000 or less, to create more homes.
Domain Homes defines itself as an urban renaissance new home builder. They procure home sites in Tampa Bay’s most popular and established neighborhoods – including South Tampa, West Tampa, North Hyde Park, the Heights, and St. Petersburg. They replace older, run down and dilapidated homes with brand new ones that are close to highly rated school districts, shopping, cultural amenities and the nightlife in downtown.
As the premier urban new home builder in Tampa, Domain Homes understands how important location is to buyers, and they believe buyers shouldn’t have to settle for a “used” home as they begin searching in their chosen neighborhood.
That’s why Domain Homes builds dream homes in neighborhoods where buyers are eagerly looking.
The city of Tampa and Domain Homes have teamed up on the Urban 360 Initiative, a first of its kind program to create new homes that first-time buyers can afford. As Domain constructs the homes, the city of Tampa will be providing down payment assistance.
And that’s why city leaders are working so hard to encourage renters to consider homeownership instead, which helps make Tampa’s neighborhoods more livable, and helps stabilize neighborhoods as new owners become more invested in their community.
That could further boost the local housing market, particularly at a time when many of the new apartment buildings under construction are geared toward the high-end market. Downtown Tampa has experienced a record building boom in recent years, with the city issuing more than 16,855 permits for residential projects in recent years, for more than $2.4 billion worth of development.
On the other hand, lavish downtown apartment towers with rooftop pools and fitness centers have been priced far beyond the reach of a lot of city residents.
That reflects Tampa’s fast-growing economy. The Tampa Bay area added 30,500 new private-sector jobs in the last year, the second-highest number of jobs among all Florida metro areas. Local industries with the highest growth over the past year in Tampa have included leisure and hospitality with 8,300 new jobs, and education and health services with 7,900 new jobs.
That economic growth keeps attracting newcomers to the Tampa Bay area, and that’s helped push up the cost of renting an apartment.
The major challenge for the housing market, on the other hand, has been a lack of inventory – there are not enough homeowners putting their house on the market for supply to meet demand. That’s helped push up the price of homes.
But now the Urban 360 Initiative is likely to turn that situation around, giving buyers – including first-time home buyers – more appealing options for getting out of an expensive apartment, and into their first home.
Rising Rents in Tampa Lead to Home Buying
With a strong economy, rents in the Tampa Bay area keep rising, which could put pressure on renters to take another look at home buying.
And because of the shortage of existing homes on the market, Tampa city leaders have reached out to Domain Homes to build more affordable homes for first-time buyers.
Domain Homes is constructing houses as part of the Urban 360 Initiative – houses built to the company’s usual high standards, but with prices that work for first-time buyers.
The city of Tampa is providing down payment assistance to these prospective buyers, while Domain Homes has a team of partners waiting to help those buyers get through the home buying process.
Visit the Domain Homes website today and click on their Urban 360 Page to find out of you qualify for down payment assistance. Just fill out the form on the page or call Domain Homes at 813-800-0360 for any question you may have.
Domain Homes’s Urban 360 Dream Center is at 815 E. Palm Ave. in Tampa.