In a booming economy, why are new homes in Tampa Bay so affordable?
The Florida lifestyle is hot right now. The Sunshine State became one of the fastest-growing in 2018.
A lot of newcomers to Florida are in search of a relaxed atmosphere with a stable economy. Tampa Bay is now the nation’s 10th-fastest-growing metro area, adding 54,874 to its population. Why are Florida and the city of Tampa doing so well? Thank the fast-growing economy in both that’s creating plenty of new jobs.
Big population increases usually correlate to rising prices, particularly for housing. Major metropolitan cities like Los Angeles, San Francisco, Boston, and Seattle have plenty of newcomers. They also have soaring real estate prices.
Tampa has the newcomers, but not the big price hikes. What Tampa is offering new residents is different. They’re getting a vibrant economy that’s creating jobs. They also get home prices, including for new homes, that remain affordable.
A new study shows Tampa Bay homes are more affordable than in other parts of Florida. They’re also less expensive than in other major metro areas along the U.S. coast.
So why is Tampa both a boom town, and still an affordable one in a state that keeps growing?
How Does Tampa Rank for Affordability?
HSH.com, a mortgage information company, studied affordability in major urban areas and noted that “affordability” is becoming more challenging in top metro areas.
However, Tampa Bay is doing better than Florida’s other two major metro areas, Orlando and Miami. Someone earning the median income in Tampa can afford the median-priced home there. That includes new homes in Tampa.
A Tampa Bay buyer would need a salary of $54,627 to afford the median-priced home ($238,700). So Tampa prices are still well within the range of affordability. Tampa’s median income was $51,000 in 2016, according to income estimates from the U.S. Census Bureau.
Economists believe wages here have gone up in the past two years, thanks to the strong economy.
Home prices in both Orlando and Miami have risen faster, compared to incomes.
Tampa’s housing market is healthier today than it was in 2006. Back then, the economy was strong, and the Tampa Bay region’s median home price peaked at $245,000.
The Great Recession that hit in 2008 hurt Florida’s housing market. The market has made a strong comeback in the past few years.
In 2006, the median income in Tampa Bay was $43,742. It was much harder then to afford the average home compared to today.
In comparison, Orlando residents today need to earn $61,000 to afford a home. The median priced house in Orlando is $269,000. That’s $10,000 more than the median income.
And in Miami, the median home price is $353,000. It requires a salary of $78,337 to buy a home there, although the median income in Miami is also $51,000.
Tampa Bay’s $238,700 median home price, including the new homes in Tampa, looks better than what you get in other cities.
Why are New Homes in Tampa Still Affordable?
A few years ago, a study by SmartAsset ranked Tampa Bay as a home seller’s “dream market.”
Tampa had four of the top 10 easiest places to sell a home in Florida being in the bay area. Few homes in the bay area were decreasing in value.
And it was a healthy housing market there, stable and affordable. That included new homes in Tampa.
The risk of losing money over the long run after investing in a home here was low.
The rankings focused on “stability, affordability, fluidity, and risk of loss.”
By 2017, the region was struggling to some extent, as was the rest of the nation, to boost home sales. But that was not due to low demand, but a shrinking inventory. Fewer and fewer homeowners were putting their homes on the market.
That low inventory meant homes on the market got snatched up fast. Prospective buyers faced a challenging market with fierce competition.
Still, Tampa Bay has maintained one clear advantage over other cities. There are still builders like Domain Homes constructing new homes in the area. That gives buyers the option of a brand-new home as well.
And as Tampa Bay’s median income has gone up in the past decade, the median home price is actually a tad bit lower. In other words, there has never been a better time to buy a home here.
It doesn’t hurt, either, that Tampa remains a leader in the state when it comes to creating new jobs.
Compare Tampa’s situation to other major metros, as HSH did. In San Francisco, being able to afford the city’s $1.07 million median home price requires a median salary of $213,727.
In San Diego, the median home price of $645,000 requires a median salary of $130,986.
You get the picture.
NerdWallet recently looked at the 10 metros with the highest population growth.
The study found that Tampa not only made the top 10 but also had the second-lowest house prices on the list.
In Tampa Bay, the median income fits with what the average family needs to buy the median-priced home. It’s a great deal for people looking for the ideal place to live.
The fact that Tampa has a booming economy that’s creating lots of jobs doesn’t hurt either.
Families have a lot of good reasons to move to Tampa. That includes the strong economy and an affordable housing market. Add to the mix great cultural amenities and the appeal is obvious.
Now Tampa has the benefit of an affordable housing market, too. That’s true of new homes in Tampa.
The city’s newcomers need someplace to live. That’s why builders like Domain Homes are constructing new houses here.
Domain Homes procures older houses in the city’s most appealing neighborhoods. They get replaced with brand new, move-in ready homes.
Domain Homes builds in South Tampa, West Tampa, North Hyde Park, the Heights, East Tampa, and St. Petersburg. Their homes are close to top-rated schools, the downtown, and to jobs.
Contact Domain Homes today at 813-580-8111 to learn more. We have homes available to match your dream of homeownership in the Tampa Bay area.