Although the home price drops in Tampa are hurting home sellers, real estate professionals and the overall housing market, these price decreases are helping the market in another way – making Tampa homes affordable to more people wishing to be homeowners in the city.
According to the latest 20-major city house price study by Standard & Poor’s Corp., which is for the month of September, the price index for Tampa dropped by 0.8 percent over the month and dropped by 4.3 percent over the year. Among the 20 cities in the S&P index, Tampa had the sixth biggest drop year-over-year. It, however, had the sixth lowest drop month-over-month.
Top cities with the biggest price index drops in September year-over-year:
- Chicago — 5.6 percent drop
- San Francisco — 5.5 percent drop
- San Diego — 5.0 percent drop
- Washington — 4.5 percent drop
- Los Angeles — 4.4 percent drop
- Tampa — 4.3 percent drop
Top cities with the biggest price index drops in September month-over-month:
- Cleveland – 3 percent drop
- Minneapolis – 2.1 percent drop
- Portland – 1.9 percent drop
- Dallas – 1.6 percent drop
- Phoenix – 1.5 percent drop
- Chicago – 1.5 percent drop
According to the Census Bureau, the national median price for new homes in September was $226,300, and then dropped in October by 13.9 percent to $194,900, the lowest price posted since October 2003 when the national median price was $194,100.
Home sales data from the Florida Realtors also showed price decreases in the Tampa Bay area in October. The median price for all homes sold in the Bay area dropped to $137,900, a decrease of 1.92 percent compared to $140,600 in October last year.
Despite the price declines, the volume of existing home sales dropped to 1,923 units, a sharp drop of 25 percent, the second biggest drop since February 2008 when sales fell by 29 percent.
According to housingtracker.net, the median home price in Tampa as of the last week of November 2010 was $145,000, representing a drop of 2.7 percent from October and a sharp drop of 13.9 percent from November 2009.
The affordability of homes in Tampa is also shown in the maximum home loan limits assigned to Tampa by Fannie Mae and Freddie Mac under the Housing and Recovery Act of 2008. While home buyers in other cities in the country are allowed to borrow up to $729,750 in Fannie-guaranteed or Freddie-guaranteed loans for single-family homes, the maximum loan limit for Tampa is $417,000.
As always emphasized by real estate sellers, Tampa is still a buyer’s market. With still very low mortgage rates and plenty of home listings to choose from, the home buyer has all the advantages.