Report: Tampa's housing market hottest in the country

TAMPA — Tampa’s housing market will be the hottest in the country in 2022, with home values rising 24.6% through November, about 10 percentage points higher than the 14.3% home value growth expected nationally, according to a new report from Zillow.

The prediction catapults metro Tampa from No. 4 on last year’s list of the 10 hottest housing markets to No. 1 on the online real estate firm’s annual list. The growth, according to the report, will be largely driven by a booming job market, limited — and fast moving — inventory and demographics showing a large buyer pool, says the online real estate company.

The typical house in Tampa is valued at $323,040, according to Zillow.

That home prices — in Tampa and elsewhere — will be surging shouldn’t come as a surprise. The report’s authors say many of the same forces driving last year’s market are still in play and will keep demand, as well as prices, high this year. Among these are low mortgage rates, demographic shifts and pandemic-driven decisions on where to live along with limited inventory.

“None of those trends is expected to change much in 2022 from 2021, and limited housing supply coupled with sky-high housing demand is a classic Econ 101 recipe for rising home values,” the report says.

There are a couple of risk factors that could slow the market, though: Rising interest rates and volatility in the stock market.

Interest rates, which have been historically low, are expected to rise this year making it more expensive to buy a home. “At the margin,” the report’s authors write, “this would restrict the inventory accessible in the most expensive markets, potentially driving up competition for the lowest-priced homes in those markets or removing them from consideration altogether.”

As for the stock market, the report says forecasts for 2022 show year-end targets vary from a 7% decline to a 13% gain, both slower than the past two years. This, the authors say, will mean “buyers are bringing relatively less to the table for a down payment in 2022.”

“This would most affect markets where there are a lot of first-time buyers or where more buyers are entering from lower cost areas, bringing less equity from their previous home.”

Tampa is not among the markets to see substantial slow downs in either of these cases, according to the report.

In addition to Tampa, two other Florida cities made the list: Jacksonville came in No. 2 and Orlando No. 9.

Overall,  cities in sunnier climates are expected to lead the pack as housing prices jump. Along with the three cities in Florida, San Antonio and Austin, Texas and Phoenix made the top 10.