Freddie Mac Names Tampa Top Multifamily Market For 2017
Demand for apartments is at a historic high, and Freddie Mac has named Tampa, FL one of the top multifamily markets for growth in 2017.
Recent data shows rental demand is the highest it has been since the 80s, and probably in our nation’s history. Rising interest rates, ongoing tightness in access to home loans, and uncertainties in the economy and global political environment are likely to ensure this trend continues.
Analysts expect the need for rental apartments is only going to grow as boomers choose to lease and run out of retirement funds, millennials and generation Z become our first fully mobile workforces, immigration continues, and the population swells. Even the recent surge in new construction which is peaking this year is believed to be lagging far behind what is required.
This housing shortage is also pushing up rents. At least with the exception of some peaking cities like San Francisco.
Freddie Mac forecasts multifamily income growth for Tampa this year at 4.4%, with vacancy rates at just 5.2%. That puts Tampa, Florida as one of the top seven cities in America. That’s just behind destinations like Seattle, Colorado Springs, and Phoenix. Yet, ahead of cities like Jacksonville and Los Angeles.
This is great news for commercial real estate investors who are already holding Tampa apartment buildings in their portfolios, as well as those seeking new acquisitions with strong yields and growth prospects.
While a top choice for investors, tech businesses, and developers this year, Tampa still offers a variety of investment opportunities. There are retrofitting and repositioning opportunities. Opportunities to participate in new construction and mixed use projects, and performing apartment building which are ready for fresh owners and managers.
These buildings can be purchased all cash, using commercial mortgage financing, owner financing, leveraging self-directed retirement accounts, and equity partnerships.
With recent developments in California’s hyper-expensive markets, and the devastation of hurricane Harvey, Tampa multifamily real estate could see an even larger surge in demand over the coming months. The first in will definitely be those positioned for the best gains.