There is no question about it—home values are soaring like never before. There are many reasons for this, including the skewed nature of the market thanks to the pandemic and the fact that interest rates are almost at all-time lows. This trend seems to be happening everywhere, including in the state of Florida.
Florida is currently experiencing an influx of new residents. According to the Tampa Bay Business Journal, it is estimated that between April 2020 and April 2021, Florida’s population grew by 1.38% (or about 298,000 people—an average of 1000 people a day). That growth translates into more demand for single-family homes which will result in higher prices.
A low-interest-rate environment, coupled with intense buyer demand, continues to reduce inventory levels, which makes it challenging for buyers to find a home. In part due to this shortage of homes for sale relative to high demand, home prices rise, affecting housing availability and affordability, especially for first-time buyers.
Tampa Bay is one of the hottest housing markets in Florida at the moment. Currently, the median number of days a Tampa home stays on the market is seven days, down from 25 just a year prior. These factors have all contributed to an increase in the median home price to $297,390 which is a 15.2% increase from the previous year.
Significantly more buyers are paying for their homes in cash (often sight unseen). Homebuyers who need a mortgage find it difficult to find a house when competing against buyers who offer huge cash amounts—often from out-of-state buyers looking for a state that doesn’t have a state income or estate tax.
Once the pandemic is over, supply and labor issues will begin to resolve and the construction of new homes will increase to meet demand. In March 2021, the number of homes built increased by 19.4% (1.74 million units)—the greatest gain on a month-over-month basis since 1990 and the highest level since 2006.
Today, the housing market is short more than 4 million units. While this gap won’t close overnight, builders are taking steps to improve it.
While the single-family market has seen a lot of growth over the past year, multifamily is expected to become much more lucrative as we move forward. Renters will become more financially stable as we move away from the pandemic economy and will be looking to rent their own place.
So, while looking for a new home, it’s important to keep these statistics in mind and if you are considering selling your home, please give us a call—we have a team of professionals standing by to service you.
It is our greatest pleasure when we can hand the keys over to a Buyer after selling your home so give us a call at 727-298-8888 or visit our website to contact us at laurenmichaelsrealestate.com.