The real estate market in West Central Florida is expected to experience very healthy growth in 2017, which is great news for the local economy. The outlook is positive thanks, in part, to the area’s excellent ratings for both housing affordability and job growth.
The real estate website Trulia just released its list of the top 10 hottest real estate markets across the nation, and Florida’s cities draw high rankings.
One of them was the Tampa-St. Petersburg area, which came in 5th place. That high score was credited to several factors, including a fast-growing job market, and the popularity of the University of South Florida and University of Tampa as major draws as well.
This is great news for home sellers in Tampa, and for the overall West Central Florida economy.
But there’s also good news for home buyers. According to a new study by Forbes magazine, Tampa ranks high in another category: housing affordability.
Housing Affordability in Tampa
Forbes and Local Market Monitor just issued their list of the top 10 American metro markets when it comes to housing affordability, and the Sunshine State did quite well. The study notes that four Florida cities — Jacksonville, Orlando, West Palm Beach and Tampa — rank high when it comes to housing affordability. That provides the Tampa area with another big boost: that housing affordability helps attract young families to the city.
According to the Forbes study, there are a few northern cities, including Columbus, Ohio and Pittsburgh, Penn., that are doing very well when it comes to housing affordability. But the real booming hubs, the study noted, are in the South, especially in Florida.
Affordability is defined as the percentage of an individual’s income needed to pay for housing costs. A report in 2016 by Harvard University’s Joint Center for Housing Studies notes that more than a third of U.S. households spend 30 percent or more of their income on rent or a mortgage.
In the 11 biggest metro areas in the nation, most – including New York, Los Angeles, Chicago, Dallas, Atlanta, Boston, Washington DC, Miami, and San Francisco — have become cities where the majority of residents are renters, not owners, thanks to the sky-high cost of buying a home. San Francisco has even started to explore rent control options as apartment costs skyrocket as well.
But that’s not the case in Florida.
Some of the fastest home value growth has occurred in cities like Tampa and Orlando, but prices are still quite affordable there compared to urban areas like San Francisco and New York City.
In fact, Tampa ranked behind only Nashville and Portland, Ore., for price growth, but the median home value in the Tampa Metro area, $181,200, is well below the sticker shock prices in Los Angeles or New York.
Home values in the Tampa Metro area were up 11.9 percent in the past year, the real estate site Zillow reports, and the site predicted Tampa’s prices would rise by at least another 4 percent this year.
That increase in homes values is getting a boost from the job market. As housing affordability remains strong, the healthy job market in Tampa is attracting more newcomers to the area.
In January, the Tampa area added 36,900 new private-sector jobs, and the Tampa area’s unemployment rate was a low 5.1 percent.
Tampa is riding the same wave as the rest of Florida. U.S. News & World Report just issued its 2017 Best States ranking, and Florida ranked in the top 10 when it came to the strength of the economy.
The Sunshine State ranked No. 7 in terms of economic performance, but Florida also ranked No. 1 in the nation for entrepreneurship and new businesses being created.
The Tampa Bay area is now enjoying the best of both worlds. Home prices are rising, but the cost of buying a new home remains very affordable compared to so many other metro areas across the United States.
At the same time, strong job growth in Tampa is encouraging more people to relocate here.