Report: Tampa-St. Pete housing will be a top 5 US market in 2025

Tampa Bay’s housing market, which has been hit with obstacles ranging from hurricanes to high interest rates in the past couple of years, remains strong and is poised to be one the tops in the nation next year.

That’s according to an annual report just published by PwC and the Urban Land Institute.

The report, titled Emerging Trends in Real Estate 2025, ranked Tampa-St. Petersburg as No. 4 on its list of the top 10 markets to watch next year. That is up 14 spots from last year.

Dallas-Fort Worth was No. 1 on list with Miami coming in at No. 2 and Orlando at No. 6.

The annual Emerging Trends report looks at new market dynamics, favored locations and property sector opportunities influencing the overall health of the industry.

According to the report, Tampa-St. Petersburg’s housing market is worth watching because of continued population growth; the area’s positive business climate; and job growth forecast at 2.3 times the nation’s five-year forecast.

These factors, the report’s authors write, “set the stage for continued demand for Tampa real estate.”

But the report came with warning signs for the area as well.

Chief among those is the cost of homeowners’ insurance in Tampa-St. Petersburg, which ranks among the 10 highest nationally, and home prices, which have risen 66% in the past four years. Because of this, “much of Tampa’s previous housing affordability has eroded, with little hope of returning in the near term.”

“On the bright side,” the authors add, “costs of doing business remain below national averages (95% of the national rate, per Moody’s), with costs considerably lower than U.S. averages for energy, state, and local taxes, and office rent.”

Coupled with falling interest rates, the economic landscape is expected to be conducive for outsized returns on real estate, the report says.

Among its other trends the report identified:

• Industry leaders are more confident than a year ago but remain cautious.
• Build-to-rent may see supply glut in high-growth areas.
• Higher insurance costs due to growing climate change risks are affecting CRE and housing markets. 
• Data centers dominate the real estate market.