Real estate investment opportunities are looking bright in sunny Tampa, Florida. Forbes recently ranked the city among the top 20 U.S. housing markets to invest in this year. CNN Money has ranked it among the top ten.
Why’s the market so hot?
Healthy job growth, strong population growth, and anticipated home price appreciation are to thank for the area’s resurrection after the recent downturn that drove housing prices considerably lower than other U.S. states.
Top City for Real Estate Investing: Population Growth Helps Fuel Market
Tampa’s 3.1 percent population growth rate now indicates people are moving to the city faster than the 2.3 percent national average. The city’s proximity to beaches, mild year-round weather and culture steadily draw tourists and transplants to the area.
Retirees, second-home buyers, and vacationers comprise much of the state’s market, which creates more volatility in weaker economic periods. But now these buyers are returning to the Sunshine State as the economy has stabilized and continues growing.
As the influx continues, the need for services creates more jobs, which in turn creates a steady supply of renters. Florida added about a quarter-million jobs in 2015, according to Florida TaxWatch.
Prices Rising Rapidly
Housing prices are accelerating at a rate of nine to 14 percent in the Florida cities ranked on Forbes’ list, including Tampa, Orlando, Fort Lauderdale, Cape Coral, and West Palm Beach. Average home prices are highest in West Palm Beach at $285,000, and lowest in Tampa at $193,000, according to Forbes.
Low and middle-income earners are struggling with the rising housing prices and stagnant wages, putting home purchases out of reach for many. This is also strengthening the rental market, which benefits rental property investors. Thus, adding to the reasoning behind Tampa being a top city for real estate investing.
A thriving rental market means rents will continue to rise with the demand. Returns for rental property investors in Tampa were projected to exceed the national average by about 2.4 percent annually, according to CNN Money.
Foreign Investment In the Sunshine State
More than 20 percent of foreign investors are putting their money in commercial properties and residential rentals in Florida. The only other state near that figure is California, with 16 percent. Foreign investors from all over the world choose to buy in Florida for a variety of reasons. Some purchase homes to escape the cold during the winter, then rent out the properties the remainder of the year. Other snowbirds are flocking to the area to live full-time after retiring. Still others are purchasing properties for their rental income potential.
Ready to invest in sunny Tampa, the top city for real estate investing? Do your homework and find a savvy team of experienced real estate professionals to guide you. With the market heating up, there are many opportunities for those willing to make the move into real estate.