First-time homebuyers might long to buy a house in a hip, urban neighborhood in South Tampa, but area Realtors say the competitive seller’s market has forced younger buyers to settle in the suburbs.
Rae Catanese, a Realtor with RE/MAX Bay to Bay Real Estate Agency, said the prices in South Tampa are higher to begin with — and that’s before buyers get into so-called “bidding wars” that can drive prices even higher. Without the cash, many younger buyers can’t compete.
“It’s a really unhealthy market right now,” Catanese said. “We are down to three months of inventory in Tampa. A healthy market is six months of inventory and an equal number of buyers and sellers.”
Catanese, who works with clients throughout Hillsborough County, said the average sales price of homes in South Tampa is about $500,000.
“You have to make money to be able to afford a home in that price range,” she said. “Younger people are sticking to condos and townhomes.”
But even some condos in South Tampa are out of reach for first-time homebuyers due to investors making cash purchases.
“I feel sorry for first-time homebuyers who just want a place to live but are outbid by investors making cash offers,” she said. “It’s rough — it’s really rough for them.”
Move-up buyers bidding on single-family homes in South Tampa also tend to be more financially secure with cash on hand to pay above asking price, she said.
Catanese said one of her clients paid $60,000 above the appraised value of a home in Dana Shores one year ago. It turned out to be a good decision, because the house is now worth what he paid.
“Right now people are afraid of selling unless they are moving out of the area because they can’t find a place to buy here,” Catanese said. “I myself am telling people who want to sell to look for a place to buy first because their home is going to sell fast. They don’t want to get stuck not having a place to go.”
Domingo Quintero III, a Realtor with Keller Williams Realty in South Tampa, said that when it comes to folks moving to South Tampa from the suburbs, he has noticed two trends in the past three to four years.
Quintero said one group is comprised of people who grew up in South Tampa but couldn’t afford to buy homes there until they were older.
“This group is comprised of people of all age groups and family sizes with one thing in common — they once lived in South Tampa,” he said. “Whether it is the superior school system, the closer commute to work, or they never want to eat at another Olive Garden or Applebee’s ever again — this group once had a taste of the life in South Tampa and yearns to come back.”
He said the second group is made up of empty nesters that may or may not be retired yet.
“I have sold several properties to buyers in their early 50s that have kids off to college and want to get rid of the monster house in the ‘burbs and get either a condo or townhome walking distance to many activities South Tampa has to offer,” he said. “These often tend to be cash buyers with more disposable income.”
Some of the most popular neighborhoods for the empty nesters include Harbor/Davis Islands and downtown/Channelside.
Catanese said while inventory is low in South Tampa, she has noticed a recent boost in new home inventory. Since many areas of Hillsborough are built out, first-time home buyers can often find inventory homes in the outlying subdivisions in Wesley Chapel/New Tampa area or in South Shore.
“I’m seeing a lot of new construction where builders have inventory and they are blasting me emails every day,” Catanese said. “They might have overdone it.”