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2014 Tampa Housing Market Forecast | NAR Says Tampa in TOP 10 for Turnaround!

What are the predictions for the Tampa Real Estate market in 2014?

In 2013, the Tampa Housing Market saw a rebound.  If you’ve been following the headlines, some of the most popular trends reported here in the Greater Tampa Bay Area were focused on historically low inventory and real estate bidding wars.  We’ve seen it all this year!  Will this rebound hold true in the new year?  What upcoming changes will affect future buying and selling?tax benefits home buying

Bad News for 2014

The bad news for 2014 is that a number of tax breaks will have expired.  Congress may extend, or even make permanent, a number of these breaks, but it is unclear when that might happen.

Some of the expired tax breaks which affect homeowners are:

  • The ability to deduct premiums for mortgage insurance (PMI) provided by private mortgage insurance companies, the Rural Housing Service, the Federal Housing Administration, and the Department of Veterans Affairs.
  • The ability to exclude on a principal residence up to $2 million in taxable income because of debt forgiven in a foreclosure or forgiven by a lender in a short sale or mortgage restructuring.  Originally, expected to expire in 2009, it was extended. The impact will vary from state to state, though, with the credit expiring.  Several states have anti-deficiency legislation in place.  Florida does not.
  • The ability to take a maximum lifetime tax credit of up to $500 for energy efficiency improvements in their primary residence.

Another bit of bad news is that home interest rates are on the rise. According to Fannie Mae’s latest Economic and Housing Outlook report, interest rates are expected to hit 5.3 percent by 2014.

Let’s take a look at the impact a rise in rates would have on homeowners.  If a person purchases a home today with a rate of 4.285%, a monthly principal and interest payment on a $300,000 home with 20% down- the payment would be $1,168 per month. However, if the rate jumps to 5.3 percent, as forecasted, the monthly payment would increase by $165 to $1,333 for principal and interest. As you can see, homes would become less affordable and property values might see an adjustment downward.

Indifferent News for 2014

In January, the Dodd-Frank Wall Street Reform and Consumer Protection Act goes into effect.

Its effect is unclear.  The act is designed to minimize the risk that borrowers may default on residential mortgages. Debt ratios are limited to 43 percent and loan fees to 3 percent. Negative amortization and interest-only loans will not be permitted.

The downside is making changes an agreement to correct a mistake will be prohibited and it will take longer and be more difficult to obtain a loan.  Competition for mortgage lenders also may decrease.

Good News for 2014

Despite the expiring tax credits, rising interest rates and the new protection act, it’s not all bad news.

The Federal Housing Finance Agency has said it won’t reduce the $417,000 Fannie Mae and Freddie Mac conforming loan limit.

Home sales are forecasted to rise 10 percent in 2014, according to the National Association of Realtors and inventory is at a 13 year low.  Home prices are expected to rise 6 percent.

And there’s good news for those who have been through a short sale.  Some lenders have begun offering loans just one year after the homebuyer has gone through a short sale. This means some renters can rejoin the buying pool sooner than they could in the past.

Good News for 2014 the South Tampa Area

In South Tampa the real estate market has been steadily improving.  The National Association of Realtors has named Tampa one of 10 housing markets it believes will see a housing turnaround.

Signs of the turnaround have already begun in South Tampa’s 33629 zip code.  When Oct. 2012 is compared to Oct. 2013, the last month when statistics were available, the average selling price in all categories increased with three bedroom condos and townhouses seeing the largest increase – nearly 48 percent.

The number of properties sold increased and average days on the market decreased from 102 to 67. Both detached single family homes and attached homes such as condos saw increases.  In fact, home prices increased by 26.51% percent!  In October of 2012, the average selling price was $423,696. This past October, it was $535,998.

This momentum is expected to continue in the future.  2014 is going to be a great year.

Thinking of Buying or Selling? Contact us for a market evaluation or home buying consultation.    In addition, if you are not already a subscriber to The Tampa Real Estate Insider Blog, why not follow the trends for 2014 by signing up here. I post useful articles 2-3 times a month.

Cheers to you and yours for a healthy and prosperous New Year!

Rae Catanese, Realtor

RE/MAX Bay To Bay, Tampa Fl


Fannie, Freddie regulator won’t touch conforming loan limit in 2014

New rules for jumbo loans, qualified residential mortgages could make homebuying more costly in 2014

Tax breaks real estate pros and their clients should be prepared to do without in 2014

Good news for California homeowners facing short sales

Written by Rae Catanese, Realtor

Licensed Realtor since 2002, Tampa Bay’s own Rae Catanese regularly gives expert advice and insider tips about the Tampa Bay real estate market via her blog, The Tampa Real Estate Insider. If you are thinking of buying or selling a home in the Tampa, St. Petersburg or Clearwater areas-then this blog is for you. I typically post articles once a week. To make sure you don’t miss my newest posts, you can subscribe here! Have a real estate question? Email me here!

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