Tampa, Florida's annual starts increased between the first and second quarters of 2023, ending the consecutive quarterly declines that had occurred since the beginning of 2022.
Annual closings also increased in the second quarter to their highest level since third quarter 2007. Years of high-income job growth and strong in-migration have made Tampa one of the best-performing markets in the United States.
Among large markets nationwide, Tampa has one of the highest average monthly new-home sales rates this year and is one of a handful where the new-home sales rate is notably higher compared with pre-pandemic 2019, outperforming expectations for this year given how much mortgage rates have risen.
Strengths
Tampa's job growth has moderated this year but remains relatively strong and is outpacing Florida and the nation. Resale supply is 40% below 2019 levels. Tampa was No. 2 in the nation for growth in domestic net migration from July 2021 to July 2022.
Weaknesses
Among major U.S. markets, Tampa has experienced the largest year-over-year percentage decrease in active community count, which has hit record lows. It is still significantly undersupplied for vacant developed lots and the seventh tightest market for lots in the nation, relative to equilibrium.
Supply
Quarterly housing starts increased 12.4% over a year ago, while the number of available vacant developed lots sits at 14,621, up 12.1% over the same quarter last year. Regarding supply/demand balance, the market area is 5.73% undersupplied.
Sales
New-home sales in the metropolitan area decreased 6.2% year over year to an annualized rate of 10,033 units in September. Existing-home closings for the 12 months ending in August posted a year-over-year decline of 28.6% to an annualized rate of 63,624 units.
Prices
The average list price for a new detached home decreased 5% from 2022 to $444,644 in September, while the average list price for a new attached home decreased 10.1% over the same period to $330,609. Homes priced under $250,000 experienced the most closing activity over the past year. The new-home affordability ratio for detached homes reached 25.1% in August.
Economy
TotaI nonfarm employment in the area increased 3.1% from last year to 1,538,000 payrolls in August, with approximately 3,300 more jobs compared with the previous month. The local unemployment rate increased to 2.9% in August compared with 2.7% in the prior month. August's jobless rate was higher than it was this time last year when it stood at 2.7%. Zonda forecasts the region's unemployment rate will finish the year at 2.6%.
Community
The current population for the Tampa-St. Petersburg-Clearwater, Florida, metropolitan area is approximately 3,328,540 people and is projected to increase by 1% this year. There are approximately 1,378,460 households in the region, which is up 1.5% year over year. Forecasts show that current household formation is expected to increase by an annual growth rate of 3.9% for 2028.
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