Is the Tampa Bay housing market crashing? That’s exactly what recent headlines would have you believe. In fact, Newsweek recently published an article titled: “Florida Housing Market Turning Down Fast.” The story highlighted a St. Petersburg home that sold at a massive 28% loss earlier this year, stirring even more fear and uncertainty.
But while the headlines sound alarming, the reality behind the Tampa Bay housing market crashing is far more complex and surprisingly stable.
Let’s look closer at the Newsweek example:
This wasn’t just a case of the Tampa Bay housing market crashing. This was an example of a bad investment during the pandemic pandemonium. The question is, what led up to these bad decisions?
Many people look back at the real estate market of 2020-2023 as a housing boom. In reality, it was an unprecedented period of imbalance:
For the first time in history, no one cared about the value of the home. No one cared if it was a good purchase or not. It was total insanity fueled by fear and scarcity.
Sellers received so many offers, their Realtors had to put all of the offers and terms in spreadsheets to sort them out.
The Tampa Bay housing market is not crashing. Prices have stayed flat for the past two years. Homeowners who overpaid for their property during the pandemic bubble, might experience a different reality.
Last month, we took a deep dive into the health of the Tampa Bay Housing Market. While the market has softened slightly, the numbers don’t support the narrative that the Tampa Bay housing market is crashing:
What we’re seeing is what I refer to as a “tug-of-war market”. Sellers are still anchored to pandemic pricing. Buyers are reading the headlines of values dropping and are no longer willing to pay overly inflated prices.
As a real estate professional, trying to pull the unrelenting seller and buyer together on terms can be one of the most challenging markets.
This tug-of-war explains the growing gap between asking prices and actual sales:
Despite the headlines screaming about the Florida housing market crashing, what’s really happening in Tampa Bay is a complicated negotiation between perception and reality.
But not all sellers are holding on to prices from the pandemic years. For many, it is a process of “finding the sweet spot” when it comes to price. Buyers who are in the market want to and need to buy a home. Finding the right value becomes the challenge.
In the past week, 687 new listings came on the market in Tampa Bay. Yet, there were 1387 price reductions! This begs the question: how are homes priced and why is it so hard to determine the right price?
Contrary to popular belief, price per square foot is not the answer! As my first real estate broker told me, “We are not selling homes by the pound.” What he meant was that a pound of flour is the same as a pound of flour, but each home is significantly different from one another.
Unlike cookie-cutter new builds, Tampa Bay features a wide variety of homes, many built across different decades. Pricing isn’t as simple as using price per square foot. Instead, a comparable sales approach is a better method. This approach takes into consideration factors that price per square foot does not, such as:
All of these factor into the price and none of these factor into the price per square foot!
Figure out what a buyer is willing to pay for a very specific product based on recent sales data is why pricing is difficult. Price reductions occur as sellers adjust their price to meet the needs of the market.
During the pandemic, people were afraid! The housing market suffered (in my opinion) from an overwhelming Fear of Missing Out (FOMO). Homebuyers today have a different fear – the fear of making a bad financial decision.
If the real estate market is crashing, according to the headlines, should you buy a home? If you need to sell a home in this market, are you going to lose money?
If you are buying a home, you might not be in the driver’s seat as much as you think. Technically, we are still in a Seller’s market with a 4-month supply of homes. However, with 25% more inventory on the market compared to last year, you have more homes to choose from.
More inventory available means more negotiation power. Sellers know they have competition, which is why we are seeing so many price reductions. Their home is on the market because they want to sell it. Make a compelling offer but don’t insult them. Most importantly, remember that price is just one of the terms. If your offer is clean and simple, you might get a better price than you expected.
Know your competition and stand out from the crowd. Strategically price your home from day one. Keep in mind, the number of sales has fallen over the past several years, and during that time, more inventory has come on the market. Currently, there are 25% more homes on the market compared to the previous year and 16% fewer sales. What do you have to do to stand out from the crowd?
Most importantly, home buyers want to feel like they are making a smart decision. How does buying your home become a smart choice for today’s buyer?
The Tampa Bay housing market crashing isn’t the whole truth. Every day, homes are bought and sold as families grow, downsize, relocate, or invest. Housing remains a personal, essential need, not just an economic statistic.
The key is making smart, well-informed decisions based on real data, not fear-driven headlines.
We’re here to help you navigate the Tampa Bay housing market crashing narrative and make the best choices for your situation, whether buying or selling.
Rachel Sartain Tenpenny is the founder and broker of The Tenpenny Collection, a boutique real estate brokerage specializing in luxury homes throughout Tampa, St. Petersburg, Clearwater, and the surrounding waterfront communities. With decades of real estate experience, Rachel combines market expertise, negotiation skills, and personalized service to guide buyers and sellers through today’s evolving market. The Tenpenny Collection is known for setting the standard in Tampa Bay real estate, offering expert guidance whether you’re buying, selling, or investing. Learn more at TheTenpennyCollection.com.
STAY UP TO DATE WITH THE LATEST MARKET TRENDS & DEVELOPMENTS IN TAMPA BAY