Best Areas in Tampa to Invest in Real Estate
Among the top 20 locations to invest in real estate, Tampa, Florida, consistently remains relevant for any investing career, with places such as North Hyde Park, Courier City, and Davis Island as the areas for cash returns. Many factors come into play for Tampa’s rating, but for those looking into how they should invest, one of the outstanding notes to take in is what areas will benefit the most.
Why Should You Invest in Tampa, Florida?
Tampa’s Tourist Attractions
City attractions can help make or break real estate businesses. Still, in Tampa, the city has numerous amounts of parks, museums, restaurants, and beaches, meaning that Tampa has momentum for the tourist industry, and thus make short-term rental properties and vacation homes an ideal investment for conducting business. Short-term rentals and Airbnb rentals, while riskier, can create massive amounts of returns within the next few years.
Foreign Investment
Foreign investors makeup 70% of the condominium purchases in Florida and usually pay slightly higher prices. Their ability to pay those higher prices contribute overall to the real estate market in Tampa, Florida, and combining that with the domestic demand for houses, property values will continue to increase.
Steady Population Increase
Thus, the city’s real estate investitures continually have a high demand for housing, as the population of the city increases for both commercial and residential homes and buildings. People move to Florida not just for tourism, but for a sense of retirement. Florida doesn’t have a state income tax, overall has warmer weather conditions. For real estate investors, this allows them to have huge returns on real estate investments, and give potential homeowners a sense of security with their finances.
Job Growth
People don’t only come to Florida to retire. With an unemployment rate of 3.1%, which is below the average for the entire state of Florida, and an everlasting presence of many of Fortune’s 500 companies, Tampa thrives as a metropolis of economic wealth and industry. Tampa’s workforce significantly impacts the real estate market. It’s world-class attractions and quality of life, as the city’s home to schools, hospitals, libraries, and many medium to large-size businesses, which help its residents find and maintain work. This influx of companies makes the local economy of the city worth over $130 billion, with many of their companies earning annual revenue of $1 million.
Appreciating Home Values
Because of the beautiful weather and low cost of living, homes in Tampa play a significant benefit to the economy of Florida. Real estate investments can be guaranteed a sense of security due to all the factors that play into the makeup of the city. Many successful real estate investors focus on buy-and-hold properties, which, as many know, will increase the appreciation value of those homes and give investors a higher chance of gaining their returns.
How to Search For Tampa Real Estate Investments
Now that you’ve chosen the location, where do you go from here? Some of the best areas in Tampa to invest in real estate all have their ups and downs. Still, from here, you need a strategy, a budget, and an estimated value of calculated metrics before even beginning your investments.
An investment property strategy focuses on narrowing down your goals for the entire year or next few years. For investors looking for a quick profit, flipping homes will be the fastest way to attain returns. While these types of homes typically cost more in renovations, these homes can be sold at a higher price. If looking to rent with Airbnb, then vacation homes and town-homes will suit those needs more so than a multi-family dwelling or apartment building could. On the other hand, investors looking to expand their portfolio can center their investments on a wide variety of homes and apartments.
Next, forming a budget around real estate analytics can give an estimated idea of what the expected values, projections, returns, and expenses will be with the investment you choose. Data comparisons for different properties will be able to give you an idea of the amount of work needed to complete the venture and help determine whether or not the property of your choosing will do well in the market. There are three terms that you should know when dealing with real estate analytics, which includes:
Capitalization Rates – Capitalization rates, or cap rates, use metrics and calculations to measure the amount of profitability with a real estate investment, regardless of the method of financing. The lower the cap rate, the lower the risks.
Cash On Cash Returns – As the rate of return dealing with money, this term is based on the annual pretax cash flow and amount of money invested in the rental property. Through focusing specifically on the cash related to the investment, all other benefits aren’t included.
Cash Flow – Cash flow refers to the difference between what you earn from the investment and what you spent on the investment. Similar to comparing credits and debits, the costs of the investment will usually include property taxes, mortgage payments, and repair costs.
Lastly, after making an estimated guess on what your property could entail and potentially make, finding the right resources to budget and finance your investments will help begin your search for the right properties in Tampa, FL.
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Best Neighborhoods in the Tampa Housing Market
Here are some of the best areas in Tampa, Florida, to invest in for 2020:
Courier City – Best Areas in Tampa to Invest in Real Estate
- Traditional Rental Income: $2,054
- Median Property Price: $404,450
- Airbnb Rental Income: $1,975
- Traditional Cash on Cash Return: 2.55%
- Airbnb Cash on Cash Return: 2.55%
- Traditional Cap Rate: 2.1%
- Airbnb Cap Rate: 2.55%
- Occupancy Rate: 47.36%
Tampa Heights – Best Areas in Tampa to Invest in Real Estate
- Traditional Rental Income: $1,161
- Median Property Price: $310,000
- Airbnb Rental Income: $1,114
- Traditional Cash on Cash Return: 1.78%
- Airbnb Cash on Cash Return: 1.58%
- Traditional Cap Rate: 1.78%
- Airbnb Cap Rate: 1.58%
- Occupancy Rate: 38%
Davis Island – Best Areas in Tampa to Invest in Real Estate
- Traditional Rental Income: $5,324
- Median Property Price: $847,000
- Airbnb Rental Income: $4,224
- Traditional Cash on Cash Return: 2.88%
- Airbnb Cash on Cash Return: 2%
- Traditional Cap Rate: 2.88%
- Airbnb Cap Rate: 2%
- Occupancy Rate: 54.3%
Seminole Heights – Best Areas in Tampa to Invest in Real Estate
- Median Property Price: $279,450
- Traditional Rental Income: $1,385
- Airbnb Rental Income: $2,003
- Traditional Cash on Cash Return: 2.68%
- Airbnb Cash on Cash Return: 4.82%
- Traditional Cap Rate: 2.68%
- Airbnb Cap Rate: 4.82%
- Occupancy Rate: 48.08%
Historic Ybor – Best Areas in Tampa to Invest in Real Estate
- Traditional Rental Income: $1,255
- Median Property Price: $194,450
- Airbnb Rental Income: $1,737
- Traditional Cash on Cash Return: 2.67%
- Airbnb Cash on Cash Return: 3.56%
- Traditional Cap Rate: 2.67%
- Airbnb Cap Rate: 3.56%
- Occupancy Rate: 48.1%
Why Finance With Neal Business Funding
At Neal Business Funding, we focus on providing the most assured loans and credit lines without the hassle of waiting. Our business focuses entirely on entrepreneurs and small business owners, as we work with financial lenders and work tirelessly to approve the loans you need to succeed in life. Through offering the lowest interest rates, we provide affordable loan plans that can make investing in places such as Tampa, Florida, a breeze. If you wish to learn more about our various loan plans, then contact us today to get started.
