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Market Report

Tampa-St. Petersburg Multifamily Investment Forecast

2020 Outlook

Demand Soars as Construction Thins; Institutional Investor Activity Rising

 

Corporate headquarter prominence, a strong financial sector and an expanding tech center produce solid job gains. Employment opportunities are contributing to the population expanding at a rate double that of the U.S. and the added residents will create almost 22,000 households, generating a need for additional housing. To meet the increased demand, deliveries rose above the five-year average last year, yet vacancy continued to tighten. This year, the construction pipeline thins, further lowering vacancy and driving rents higher. After investors concentrated in the urban cores during recent years, rising construction and land costs, as well as the need for cost-conscience rental options, drew them farther from the central cities. During 2020, the western portion of Pasco County will receive its largest inventory supply since 2002 with more than 660 units scheduled for delivery. Throughout the market, rising rents are generating robust demand for lower-cost housing. Vacancy in Class C units has sat below 3 percent for more than a year, producing sizable rent growth.

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