Tampa For Real Estate Investment?

Question

Hi,

Looking for guidance on investing in Tampa, what’s the vacancy rate, days on market? Specific zip codes that do really well? Also, what can be rented out easily, in terms of size and number of bedrooms? I am looking in to a SFR brand new construction that offers live and work usage. Thank you for your guidance.

Raymond J. Rodrigues · Answer

Hi @Kinnari Pandya. I know someone buying properties in the Tampa Bay area that around 2018 year built.

They have a unique rental strategy that is grossing around $4200-4500 per month as long-term rentals. Price point is around 400k and they are putting about 20-25% down payment. Their all-in mortgage payment is around $3,000 per month. They are making some pretty good cash flow in today's market. Feel free to message me and I'd be happy to connect you.

Stephen Dispensa · Answer

Cash flow return on SFRs is going to be minimal right now. I'm a broker and property manager based in Tampa. My clients who bought prior to 2022 are doing very well right now as rental rates are up and they've locked their low rates in till 2027 at least. My clients who bought post 2022 are breaking even or in negative cashflow. Rents haven't kept up with those higher interest rates, plus insurance rates have skyrocketed.

If you are purely looking to invest in newer SFR homes I would suggest looking inland in Hillsborough County in the suburbs such as Riverview and Gibsonton. Many newer builds, and frankly there's a TON of them on the market right now. Rental rates aren't massively high, but I could see these homes appreciating in the coming years.

Mya Toohey · Answer

I live in Clearwater which is a quick drive to Tampa.  It's a little bit harder to find new builds but it is possible.  Also, Wesley Chapel and Citrus Park have new builds and are great places for rentals as well.

Bhargav Hirapara · Answer

Hi Kinnari

here are some insight.

• Vacancy rates:

• The overall office vacancy rate in Tampa is 9.4%, which is below the national average of about 13%.
• For residential properties, the homeowner vacancy rate is 1.0% and the rental vacancy rate is 4.2% in the 33619 zip code.

• Days on market:

• Specific data on days on market wasn't provided for Tampa overall, but the median days on market for homes is 89 days according to one source.

• Promising areas:

• The Westshore and Downtown Tampa submarkets have seen increased occupancy, with an uptick of 175,000 square feet over the past year.
• The Westshore submarket has seen its vacancy rate drop by 100 basis points year over year to 12.5%, hitting a four-year low.

• Rental property insights:

• Tampa has a high percentage of renters, with 53% of the population renting rather than owning homes.
• The median rent price in Tampa is $2,941.
• 
• Market trends:

• Tampa's real estate market has seen strong appreciation, with a total appreciation of 129.39% since Q1 2000, at an average annual rate of 4.41%.
• The city is experiencing population growth and an influx of young, educated professionals due to increasing employment opportunities.

Regarding your interest in a brand new construction SFR with live and work usage, this could be a promising investment given Tampa's growing population and the trend of people seeking to live close to their workplaces. The flexibility of live-work spaces may be particularly attractive in the current market.

Kinnari Pandya · Answer

Very useful information. Thank you all for your guidance.

Jon Mitchell · Answer

Rentals can be difficult now in Tampa with the rise in home values and the increase in interest rates (close to 8% now if not already). The inflation is starting to turn the rental market on its back. We've somewhat transitioned from a cashflow market to an appreciation market. When that happens, your ROI will tend to suffer, and in some cases, you can have negative returns until the market is more favorable.

Doing SFR on new constructions could work if you do house hacking. In my opinion, rentals are best if you can get a house at a substantial discount to account for inflation. Not saying I'm right.. just my opinion. People have different ways to make things work.

Joseph Chiofalo · Answer

Hi Kinnari,

Are you looking for a mixed use property?

What price range are you targeting?

AJ Wong · Answer

@Joseph Chiofalo is a licensed RE Broker in FL…he might have a referral for you. Good luck.

Joseph Stern · Answer

Vacany rate is about 10% for LTR, days on market depends but 15-30, 33609, 33607, 33603, 33604, 33605, 33615, 33616 to name a few. 3/2 even 2/1 can be rented easily, you have an array of options. Shoot me a PM if you would like to connect.

Tampa For Real Estate Investment?

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