1. Business

Buy versus rent in Tampa Bay? Home ownership costs less, if you can qualify

	2121 Third Ave. N. is on on the Historic Kenwood neighborhood tour November 8.
Published Oct. 27, 2015

The high cost of renting versus buying a home in most metro areas has been well documented lately. Less known is how strikingly cheaper it is to buy rather than rent in the Tampa Bay market.

A report issued by real estate firm Trulia about millennials ages 25 to 34 and their housing options says buying a home in Tampa Bay is a whopping 42 percent cheaper than renting.

Only six other larger metro markets in the country — Houston; Baton Rouge, La.; Syracuse, N.Y.; Fort Lauderdale; Miami; and New Orleans — report a greater differential between buying and renting.

Nationwide, buying is overall 23 percent cheaper than renting these days, an argument for first-time home buyers in all but a few high-priced metro areas to try to purchase a house. Trulia found that in the highest-priced areas, from Honolulu to San Francisco (and many California cities) to New York, high home prices still made rentals a more affordable option.

But it has become an economic no-brainer for Tampa Bay millennials to seek their own home — if they are financially capable of doing so and are willing to stick around for a while.

Why is Tampa Bay's cost of buying rather than renting so out of whack?

Home prices are rising, but they remain relatively cheap after the burst housing bubble drove area home prices down 45 percent several years ago. Super low mortgage rates also make homes more affordable, though there is a growing expectation that the window of affordability will start to close in the coming year or two as the Federal Reserve starts to push interest rates higher.

Many millennials have tended to avoid home ownership, in part because they are wary of the recent volatility of home values and remember Florida's painful foreclosure crisis during the recession. They also are discouraged by weak area wages, tougher mortgage standards and the sheer drain on their wallets to cover the high cost of area rentals.

Two metro areas on Florida's gulf coast rank in the top three nationally for fast-rising rental increases, according to a recent analysis by RentRange.

Fort Myers rental prices for single-family homes soared faster than any other metro in the year ending last month, up 24 percent. No. 3 Sarasota rose 17 percent.

Tampa Bay's housing market being 42 percent less costly than renting is based on Trulia surveys and data for median home price and median monthly rent from the U.S. Census' 2014 American Community Survey. The data assume a 3.85 percent mortgage rate on a 30-year fixed-rate loan, a 10 percent down payment, itemized tax deductions at the 25 percent tax bracket and staying in a home for five years. Trulia said it factored in the initial total monthly costs of owning and renting, including mortgage payments, maintenance, insurance and taxes.

Given time, that 42 percent gap will probably shrink. More rental housing will be built, as developers are attracted by the high rents that can be charged in Tampa Bay, at least until the increased supply slows rental hikes or even eases the cost to rent.

And Tampa Bay homes will continue to increase in value, while any bump in mortgage rates will make housing more expensive to buyers who borrow.

Contact Robert Trigaux at Follow @venturetampabay.


  1. Jessica LaBouve, a penetration tester for cybersecurity company A-LIGN, poses for a portrait in the A-LIGN office on Thursday, Sept. 12, 2019 in Tampa. Companies hire A-LIGN to figure out where their digital security weak spots are, and LaBouve is one of the "benevolent hackers" that finds them. ALLIE GOULDING  |  Times
    Jessica LaBouve of A-LIGN works with companies to make their applications and platforms more secure.
  2. Stephen A. Schwarzman, CEO of the Blackstone Group, speaks at the World Economic Forum in Davos, Switzerland, earlier this year. MARKUS SCHREIBER  |  AP
    The billionaire also talks trade with China in an interview with the Tampa Bay Times.
  3. The economies of Canada and Florida go together like, well, palm fronds and maple leaves, as seen outside the Sweetwater RV Resort in Zephyrhills. (Times file photo) KATE CALDWELL  |  Tampa Bay Times
    To qualify under the Canadian Snowbird Act introduced in Congress, the visitors would have to be older than 50 and would have to own or rent a home here.
  4. Tampa investor and owner of the Tampa Bay Lightning Jeff Vinik, right, speaks about his investments in the video game industry at the eSports Summit Wednesday in Tampa as Matt Samost, Vice President of New Ventures for Tampa Bay Sports and Entertainment looks on. LUIS SANTANA   |   TIMES  |  Tampa Bay Times
    A summit at USF brought together major players and explored the possibility of an esports arena.
  5. Neeld-Gordon Garden Center, open at this location since 1925, is closing on Sept. 28. MARTHA ASENCIO-RHINE  |  Times
    The development of Pinellas County and the arrival of the big box stores helped hasten the store’s demise.
  6. 7-Eleven Inc. is opening its first location in a Brandon mall. Pictured is a location in Port Richey in 2018. | [Times (2018) TYLISA JOHNSON | TIMES  |  TyLisa Johnson | Times
    It is the first of eight mall locations opening this year.
  7. Tampa has a pilot program underway to test scooters. Clearwater could soon have one of its own. But if it's limited to downtown, who will use it? CHRIS URSO  |   Times
    The city’s plan is coming into focus, but there will be limitations.
  8. Pages from a confidential whistleblower's report obtained by The Associated Press, along with two printed Facebook pages that were active on Tuesday, Sept. 17, 2019, are photographed in Washington. Facebook likes to say that its automated systems remove the vast majority of prohibited content glorifying the Islamic State group and al-Qaida before it’s reported. But a whistleblower’s complaint shows that Facebook itself has inadvertently produced dozens of pages in their names. (AP Photo/Jon Elswick) JON ELSWICK  |  AP
    A whistleblower’s complaint shows that the company has inadvertently provided the two extremist groups with a networking and recruitment tool.
  9. Pasco County community news TMCCARTY80  |  Tara McCarty
    Neighbors voice concerns about increased traffic, water quality and adhering to the county’s protections for northeast Pasco.
  10. This satellite image shows Hurricane Michael on Oct. 9, 2018, as it enters the Gulf of Mexico. It made landfall near Mexico Beach in the Panhandle as a Category 5 storm. [Photo courtesy of NOAA] NOAA
    Nearly a year after the storm, 18,000 claims are still open.