Tampa Real Estate in 2025

All right, I get asked all the time what I think the real estate market in the Tampa area is going to be like in 2025. So let's get into it right now. I'm Sam and this is the Living in Tampa channel. Of course, we make these videos for you about what it's like to live and move to the whole Tampa area. We're also a team of realtors and we'd love a chance to earn your business. But let's get into it 2025 what to expect from the Tampa real estate market. Let's start by looking at 2024. Let's talk about price growth and let's talk about population growth. Price growth year over year for 2024 was actually down 0.9% median sales price. Yeah, so the sales price was down a little bit year over year. We were on this tear during the pandemic where it just kept going up and up and up. It just softened a little bit. You started seeing that with asking prices being cut pretty big, but it actually did affect the median sales price and it's down a little bit year over year. Now it being down almost 1% for one year doesn't affect the growth that much from the past five years where it's up almost 60%. So 1% change doesn't change that much. It is projected to continue growing and appreciating in the next year 2025, but at a very typical pace that really three to 5% kind of standard appreciation. Another interesting thing about 2024 is the number of real estate transactions was down significantly, but population in Tampa and other surrounding areas continued to grow. Florida grew the most of any state in 2024 over 370,000 net growth. So that means people leave, people die, people are born. The net growth was a little over a thousand people every day in the state of Florida. Now, not a huge concentration of those are in Tampa. They're spread out all over. Okay, let's continue on about growth for a minute. So the Tampa area, really three counties, Pinellas, Hillsborough, Pasco, and I start with Pinellas because Pinellas can't really grow. It's about a million people. It's very densely populated. It doesn't really have anywhere it can go except up and locals don't often want that. Hillsborough County to the east can grow quite a bit to the south is really kind of melding into Manatee County. And then Pasco County, about half a million people and a lot of potential to grow, especially the north, the north side, the northeast side of Pasco County can grow quite a bit. Even near me in Newport Ritchie, which Newport Ritchie is the biggest town in Pasco County at about 150,000. And up here, north by me, if you see this last video, we talked about this, this new neighborhood, 4,000 homes. They're going to do this again and again. And Pasco County is projected to grow to nearly a million people. I've seen some reports say 2040. I've seen others say 2050, and I don't really know which to believe, but locals are nervous about that growth. That's kind of the general sentiment when they start talking about these big developments, they're sad. Forests get torn down. They're sad. You know, ranch land turns into big developments, all those kinds of things. The locals are used to a very specific kind of vibe in Pasco County, where you kind of have this tropical feel and you still have some very like rural elements. Let's hit on insurance real quick. So, you know, about 20 to 40,000 homes were very damaged during the storm season, specifically with Hurricane Helene and Hurricane Milton. Those are the ones that affected this Tampa area the most, specifically Helene. Helene, we were on the dirty side of the storm, so we got a lot of that storm surge. It actually flooded my house. You see the video linked above, and it's kind of chaotic. Now that will affect all kinds of things, but people are mostly concerned about how that's going to affect insurance. So my house specifically, my flood insurance actually went up before the storm season last year. It went up a lot, like 80% for my flood insurance. And then the next renewal, it only went up about 10%. And so I'm curious to see what will happen if I still own the house in August, which I don't plan to. But a lot of people that were flooded are just moving a little bit further inland. We actually had a house that we were selling in Clearwater in the countryside area, which is really high elevation for that county. And a lot of the offers for that property came from people that flooded just a few miles away. So a lot of these people aren't looking to leave the area. They're just looking to have a little less flood sensitive property. But the way that this is going to affect insurance is a mystery to all of us. Most of these flood policies are backed by FEMA, like mine, the National Flood Insurance Program. So it's just kind of a different relationship with these flood prone areas. And now there were scares of this 50% FEMA rule being enforced really heavily. What that rule means is you can just only improve an old house so much, before you have to bring it up to current codes. Now each town enforced this their own way because FEMA needed to rely on local towns to enforce it. So for example, my house in Tarpon Springs, they hired a private inspection company that went and drove by all of these homes to see how extensive the damage was. If the damage tore down an exterior wall or something like that, then they would investigate further and see if this needed to be applied. So insurance is always a big topic and a good time to invite you to our webinars. We do these webinars every other Wednesday. Insurance is a big thing we talk about. A lot of Q&A in these webinars. We'll hit on a few different points, but then a lot of time for Q&A and insurance is always a big topic in these. Often there's past clients in there that can share their experiences with insurance as well, and other locals in there that can share their experience. I think it's really valuable. So there's a link down in the description to register for our next webinar. If you're not able to make it, you'll get the recording and be able to still get a lot of value from it. Something I hit on there a little bit, but didn't draw a lot of attention to is this kind of pent-up demand. And pent-up demand is still demand. So a lot of houses flooded. Those people now, a lot of them that I know want to fix their house and sell it and move somewhere without a flood zone or move somewhere that's not quite as low as some of those areas. But a lot of that won't happen right away. So my house and I'm repairing mine very quickly will be done end of January. But a lot of these will take until March or April to be finished and then list during the spring market, which is a really good time to list and see what happens. Now I do plan on listing mine for less than I had it under contract for previously. And a lot of these people are not expecting to get what they would have gotten for their house two years ago or even a year ago, since they have recently flooded. And all these floods do get disclosed now. There's a flood disclosure that goes with every contract stating how affected these houses were by the last storms. This is a new rule across Florida for every home listed on the MLS. That's a common concern that people ask about, especially in the webinars. So I've come to the webinars, but they ask, Hey, how will I know if the house got flooded or how will I know how bad it was flooded? There is a disclosure. You put how high the water was. And often, you know, because of your adjuster measured it, you measured it. You can estimate pretty easily, even if you said it's above the power plugs or something like that. In my house, there was about 39 inches of water. A lot of houses that were affected had that kind of 30 to 40 inch range in the Tampa area. Another factor contributing to demand is just the end of the year, the election season, all of that gets kind of pent up and then starts happening and flowing into the next year. Every time there is an election. And we saw that a lot specifically with our clients, just saying they were waiting till after the election to decide what they were going to do next. Great. Once it's done, we're connecting with them and seeing kind of how we can help with their next steps. Another factor for 2025 is going to be interest rates. Will they go up? Will they go down? It's my opinion that this kind of high fives to low sevens is kind of the new range is going to be there for four or five years, because if the economy is growing, we don't really need to stimulate the housing market by lowering rates. And it does create issues of affordability. I completely understand that. But when you look at why they lower rates, it doesn't really seem like they will. And the number of active mortgage applications increased by about 20% month over month right after the election. There is always a spark following an election season that just kind of stabilizes everything. People are also imagining that this is just the new normal. People are accepting that rates aren't coming down anytime soon. And that if they if you do want to buy, if you do want to sell, like now's the time to just go ahead and do it based on your own goals. And a lot of people buy and sell not just because they want to live somewhere tropical or because they want to live in the mountains. They buy and sell because they need a downsize or because they need to upsize or they make more money or make less money. It's those life factors that are often driving this anyway. One thing that I expect to see grow rapidly in 2025 and 2026 is the more affordable suburban developments. So further out north of me and Hudson over onto the north side of Land O'Lakes, the north side of Wesley Chapel, even the east side of Wesley Chapel out into Zephyr Hills. Those developments that have more affordable options are going to continue to increase, in my opinion. Now, the price of a starter home has also gone up dramatically. I found this article recently that broke this down and this article was talking about the three different brackets of housing prices and the bottom 40% being affordable, the next 20% being mid-level, and then the next 40% being high-end and that kind of just being the distribution of the prices. Now, this affordable chunk has just gone up quite a bit and now an affordable house in the Tampa area is in the high 300s. When I first moved here in 2020, it was in the mid 200s, even low 200s in some areas. So it has gone up quite a bit and not just the home prices, but in the midst of that, interest rates have gone up quite a bit and many times salaries and other things have not increased along with all these other life expenses that we have. So I think there's going to be more and more affordable options to fill that demand and we even see a lot of them now in the low 300s in a lot of these developments. Another thing I'm eager for in 2025 and 2026 is massive developments. Downtown Tampa is going to continue to develop. Downtown St. Petersburg, both the airports, the Tampa airport is doing a big expansion. The St. Petersburg Clearwater Airport is also doing a big expansion. Those are jobs right now and really exciting developments for our area that continue to grow both of the major cities in the Tampa area. And when it comes to downtown, there's all kinds of rumors and speculation of all these different things that will happen right along the port. All kinds of condos that could be developed. There are other condos being developed in downtown currently. A lot of them are already selling and some are even sold out. Really high-end developments down in central downtown Tampa and then over into Water Street by the stadium. The Water Street is continuing to grow and continuing to be a destination. And a lot of our clients, interestingly, it's those kind of developments that draw them here. These developments around an arena that kind of bring a lot of life to an area. And Water Street is a great example of that. In closing here, I wanted to talk about the damaged homes. I'm so curious what you guys think will happen to all these damaged homes. When they start coming back on the market, will people buy them? Will they be a lot cheaper than people expect? Was that a hundred year flood? You know, people talk about that. Maybe that was just the worst flood we're going to have for the next hundred years. I don't know. I see locals on both sides of it. Some of them very optimistic. Some of them very pessimistic. Now, if you were affected by a flood, you're going to think about it a lot differently. But a lot of locals that even have friends and family that were affected, they've never seen it that high. You know, 30, 40 years, they've never seen water like that in these towns. But I also just wonder if the way the hurricanes come in is changing. You know, I grew up in Tornado Alley in Oklahoma. And again and again and again, tornadoes would come right through our county. Now, we lived in a little valley, so they kind of skipped over us or went right around us. But again and again, every single year, it's coming right this way, coming right this way, and we didn't get hit. But it was always coming that way. So always kind of on edge. Now, Tornado Alley is in a different spot. It's shifted. And these storms shift in different centuries, it seems like. And now, you know, central Texas and Louisiana is Tornado Alley. And so it just kind of evolves with time. And I'm curious what you guys think is going to happen with the future of hurricanes, the future of this flood insurance, and all these damaged houses. What will happen when they flood the market? I'm really curious your thoughts on that. And as always, we would love to be your real estate choice here in the Tampa area. So give us a call, text, or email anytime. And don't forget to sign up for the webinar. We'd love to see you there. Thanks for coming by.