Tampa Multifamily Market Report

Market Overview

In recent years, Tampa’s economy has shown remarkable resilience, making it one of the strongest markets in Florida. Over the past decade, the population of Tampa has grown by more than 412,000 people, averaging around 790 new residents per week. In H2 2023, the Tampa region led Florida in job growth, adding 60,500 jobs in the last 12 months. Notably, almost every job sector in the Tampa region has witnessed year-over-year (YOY) growth. This growth has led to significant changes in the market, transitioning from robust rent increases and high occupancy levels to a decline in renter demand. A surge in development has resulted in an increasing imbalance between supply and demand, causing rent rates to contract in certain submarkets.

Highlights

• Over the last 12 months, 7,542 units were delivered in Tampa, while only 4,240 were absorbed.
• At the start of Q1 2024, Tampa’s multifamily vacancy reached a decade-high of 8.8%.
• For five consecutive quarters, the multifamily market in Tampa has sustained a development pipeline of over 16,000 units.
• Projected rent growth is expected to be minimal until mid-2024, largely attributed to the upcoming addition of 17,000 units in the pipeline.

Rents | Vacancy | Construction

The trend of minimal asking rent growth will persist for at least six to nine months as the market continues to process the pipeline of 17,000 units.

Tampa’s multifamily vacancy has been on the rise since it reached its near historic low of 4.1% in mid-2021. Since then, a substantial number of units have been added. However, there was a decline in renter demand in 2021 and 2022. As of Q1 2024, the vacancy rate now stands at 8.8%, marking a 100-basis-point increase YOY. Rent growth in Tampa has significantly slowed down, reaching an annual change of -0.8% in Q1 2024. This marks a complete reversal from the record highs exceeding 20% seen in late 2021 through early 2022. The influx of thousands of units into the market since then has heightened competition among renters and diminished landlords’ ability to push asking rents higher. There are 17,000 under construction, adding to the supply-side pressure on vacancy. However, it is anticipated that renter demand will align more closely with the new deliveries in the upcoming quarters.

Sales

Multifamily investment volume has decreased over the last year, reaching a trailing 12-month total sales volume of $1.8 billion. In contrast, the market witnessed a sales volume of nearly $3 billion in the concluding months of 2021 when renter demand and asking rent growth reached historic highs.

Pricing peaked at $240,000 per unit in mid-2022 and has since declined by nearly 10% to $210,00 per unit as of Q1 2024.

By The Numbers | Last 12 Months | Source: CoStar Group

• Vacancy Rate: 8.8%
• Rent Growth: -0.8%
• Units Delivered: 7,542
• Units Absorbed: 4,240
• Sales Volume: $1.8B