" /> Buying 43 Percent Cheaper Than Renting In Tampa Bay

Buying 43 Percent Cheaper Than Renting In Tampa Bay

Dated: July 13 2018

Views: 393

Buy versus rent in Tampa Bay? Home ownership costs less, if you can qualify

	2121 Third Ave. N. is on on the Historic Kenwood neighborhood tour November 8. 2121 Third Ave. N. is on on the Historic Kenwood neighborhood tour November 8. The Pierhouse Apartment located at 1226 Cumberland Ave. in Tampa is one of the new apartments in the Channelside are to offer downtown living. Most of the luxury apartments being build in the bay are are smaller than they have been in the past. But developers are offering a luxury lifestyle and amenities.

Robert Trigaux More articles  Published: October 26, 2015 Updated: October 27, 2015 at 02:54 AM

The high cost of renting versus buying a home in most metro areas has been well documented lately. Less known is how strikingly cheaper it is to buy rather than rent in the Tampa Bay market.

A report issued by real estate firm Trulia about millennials ages 25 to 34 and their housing options says buying a home in Tampa Bay is a whopping 42 percent cheaper than renting.

Only six other larger metro markets in the country — Houston; Baton Rouge, La.; Syracuse, N.Y.; Fort Lauderdale; Miami; and New Orleans — report a greater differential between buying and renting.

Nationwide, buying is overall 23 percent cheaper than renting these days, an argument for first-time home buyers in all but a few high-priced metro areas to try to purchase a house. Trulia found that in the highest-priced areas, from Honolulu to San Francisco (and many California cities) to New York, high home prices still made rentals a more affordable option.

But it has become an economic no-brainer for Tampa Bay millennials to seek their own home — if they are financially capable of doing so and are willing to stick around for a while.

Why is Tampa Bay's cost of buying rather than renting so out of whack?

Home prices are rising, but they remain relatively cheap after the burst housing bubble drove area home prices down 45 percent several years ago. Super low mortgage rates also make homes more affordable, though there is a growing expectation that the window of affordability will start to close in the coming year or two as the Federal Reserve starts to push interest rates higher.

Many millennials have tended to avoid home ownership, in part because they are wary of the recent volatility of home values and remember Florida's painful foreclosure crisis during the recession. They also are discouraged by weak area wages, tougher mortgage standards and the sheer drain on their wallets to cover the high cost of area rentals.

Two metro areas on Florida's gulf coast rank in the top three nationally for fast-rising rental increases, according to a recent analysis by RentRange.

Fort Myers rental prices for single-family homes soared faster than any other metro in the year ending last month, up 24 percent. No. 3 Sarasota rose 17 percent.

Tampa Bay's housing market being 42 percent less costly than renting is based on Trulia surveys and data for median home price and median monthly rent from the U.S. Census' 2014 American Community Survey. The data assume a 3.85 percent mortgage rate on a 30-year fixed-rate loan, a 10 percent down payment, itemized tax deductions at the 25 percent tax bracket and staying in a home for five years. Trulia said it factored in the initial total monthly costs of owning and renting, including mortgage payments, maintenance, insurance and taxes.

Given time, that 42 percent gap will probably shrink. More rental housing will be built, as developers are attracted by the high rents that can be charged in Tampa Bay, at least until the increased supply slows rental hikes or even eases the cost to rent.

And Tampa Bay homes will continue to increase in value, while any bump in mortgage rates will make housing more expensive to buyers who borrow.

Contact Robert Trigaux at rtrigaux@tampabay.com. Follow @venturetampabay.

Want to Advertise on this Site?

Latest Blog Posts

5 Criteria For Pricing A Home

 When you put your home up for sale, one of the best ways to determine the asking price is to look at comparable sales. There’s rarely a perfect apples-to-apples comparison, so a pricing

Read More

Real Estate Is Americans Preferred LongTerm Investment

Real Estate Is Americans’ Preferred Long-Term Investment From Florida Realtors When asked about the best investment for 10-plus years, 31% picked real estate

Read More

Text FIXERUPPERS To 760 712 4088 For A Complete List Of Fixer Uppers In Pinellas County

Looking for a good deal on a Pinellas Property? Use that text code above, for a complete current list of Fixers.;

Read More

NAR Existing Home Sales Surge

NAR: U.S. existing-home sales surge 11.8% in Feb.WASHINGTON – March 22, 2019 – Existing-home sales rebounded strongly in February, with the largest month-over-month gain since December 2015,

Read More