Tampa Real Estate Begins To Shift To A Buyers’ Market
It’s happening, everybody. After a long stretch of home sellers sitting in the driver’s seat, the Tampa housing market looks like it may be kicking them to the curb. Increasingly, buyers find themselves behind the wheel. They are able to take their time choosing a home from the expanding inventory of properties on the market. They’re even able to ask for significant price concessions, something that was almost unheard-of just one year ago.
Why is it shifting to a buyers’ market?
What’s behind the shift? According to realtor.com, there are two macroeconomic factors at work that may be contributing to the nationwide “softening” of residential real estate markets. One is rising interest rates, which make it more expensive to borrow to pay for a home purchase. This also makes it more attractive to hold cash in interest-bearing accounts instead of spending it on a hard asset.
Rising costs tend to deter potential buyers from entering the market. This also forces existing sellers to be more flexible with their pricing to get a property sold. Another factor, according to the team at realtor.com, is the changes brought about by the Trump tax plan. This plan eliminates mortgage interest deductions for loans over $750,000 (the cap was previously on loans over $1 million). While that change only affects buyers and sellers at the upper end of the real estate spectrum nationally, it has a real impact on the market for Gulf Coast beachfront property and second homes, which routinely price at over $900,000.
Local conditions also influence the shift to a buyers’ market in the Tampa area. In August, the Tampa Bay Times examined a growing trend of price drops on homes for sale in the four-county area, a sign that sellers may have unrealistic expectations in setting their asking price. Local real estate professionals blamed a glut of real estate agents in the Tampa-area. This encourages sellers to shop around for an agent willing to put a huge price tag on their home. They are not focused on the probability of it selling at that price.
Meanwhile, Tampa-area buyers may have reasons to be shy away from paying top dollar at the moment. Not only are the macroeconomic factors mentioned above weighing on them, but some considerations particular to the Gulf Coast may also be giving them pause. No one who watched Hurricane Michael roll ashore in Panama City could help but feel concern about a similar storm striking the Tampa area.
Hurricanes Affecting Homes
Hurricanes are a fact of life in Florida and have been for generations. Worries about how climate change may contribute to stronger storms may be causing buyers to take a closer look at how a home, particularly an older property, would fare if a “big one” hit the area, and to ask for price concessions on more vulnerable properties. The rising cost of insuring a home against catastrophic weather may also go into buyers’ calculations.
Which is not to say that Tampa’s housing market is in free-fall. Far from it. There are plenty of eager buyers out there and plenty of motivated sellers with realistic expectations. To find the right home or to set the right price in a market in transition, however, it can be important to work with a team of real estate professionals with deep local knowledge and insight.
At Team Chais, our focus is on staying a step ahead of market trends. We help property buyers and investors identify hidden value in real estate opportunities. We aid sellers in making intelligent choices about how to price and market their assets to achieve top dollar. To speak with the experienced professionals at Team Chais about buying or selling a Tampa-area property in this dynamic market, contact us today at (813) 928-4308 or chat with us online.