We expanded our make ready services to Tampa, Fla., in December. While the heart of Florida’s Gulf Coast is a natural addition to our other Southeastern markets, like many investors and developers, we had our eyes on the surging market for quite some time. Let’s dive deeper into exactly why and how the market has such a strong trajectory.
Tampa is Hot, Hot, Hot (we’re not just talking about the weather)
We of course service the multifamily market, but we look to the overarching housing market for signals. Tampa ranked first in Zillow's hottest housing market for 2022, with Zillow estimating Tampa's home values to grow by 24.6% this year compared to a 14.3% forecasted growth in national home value. It topped the Zillow 2021 list as well. Adding to its accolades, Forbes just named Tampa the No. 1 Emerging Tech City in the U.S., ahead of Miami, New York, Austin and San Francisco. With that feather in its cap comes the attention of powerful people, and their investment in the city. For example, Forbes reported that “Bill Gates and former hedge fund manager Jeffrey Vinik have invested $3.5 billion in real estate geared toward tech.”
Tampa Has Plenty of Runway
A GlobeSt.com article explored the question that it reported many investors and developers have been asking: “Is this a bubble and if so, when is it going to pop?” Their answer is, “the Florida multifamily market still has plenty of runway.” The media source states that about 1,000 people are moving to Florida every day with no end in sight. So, it’s no question that any business in or serving the multifamily industry is in a great position.
What makes this shining star in Florida so attractive? Experts cite rent growth, vacancy rates, employment growth and construction of new units as the contributing factors to its chart-topping figures in the multifamily industry. The lack of a state income tax and warm weather also add to its appeal.
Tampa Leads When It Comes to Rent Growth
With the housing market sizzling, WTSP stated that “Tampa Bay had twice the rate of growth in rental apartments in 2021 than pre-pandemic levels” as many potential homebuyers ended up settling in as renters instead. Looking at the entire state, Florida saw a 30 percent increase in average rent prices in 2021, which was the biggest spike in the country,” Tampa’s FOX 13 reported. With a more than 6.8% growth since 2020, Tampa is one of the leading multifamily markets nationwide with regards to rent growth year-over-year nationwide, according to The Multifamily Firm.
The Yardi Matrix Fall 2021 report stated that, “On a year-over-year basis, Tampa ranked second among metros where annual asking rent growth exceeded 20%—Tampa rents appreciated by 22.6% year-over-year as of September 2021.” And Real Page found that “Among the nation’s largest 50 apartment markets, Tampa recorded the third-largest annual rent hike in August 2021, behind Phoenix and West Palm Beach.”
Construction of New Units Exceeded 2020 and 2019 Numbers
Tampa Has the Job Front Covered Too
The job market is faring extremely well too, as highlighted by the following statistics.
Tampa gained 81,000 net jobs for a 3.9% expansion, 140 basis points above the U.S. rate (in the 12 months ending in July 2021); Source: Yardi Matrix
July 2021 marked the third-consecutive month of positive year-over-year job growth; Source: Yardi Matrix
Tampa private sector employment increased by 72,400 jobs year-over-year, equal to a 6.2% uptick—the area gained the highest number of private sector jobs among all metro areas (as of August 2021); Source: Florida Department of Economic Opportunity
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