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House shopping in Tampa Bay? It’s more likely to cost over $300k

The median sales price for a home in Pasco County crossed the $300,000 threshold last month, while Pinellas’ hit $355,000.
A home is for sale "by appointment only" with Keller Williams Realty at 350 Beltrees Street, on Thursday, Jan. 28, 2021, in Dunedin.
A home is for sale "by appointment only" with Keller Williams Realty at 350 Beltrees Street, on Thursday, Jan. 28, 2021, in Dunedin. [ DOUGLAS R. CLIFFORD | Times ]
Published Jun. 22
Updated Jun. 22

Another Tampa Bay county has joined the $300,000-plus club.

In May 2020, the median sales prices for a single-family home in Pinellas, Hillsborough and Pasco counties were all below $300,000. But over the past year, Hillsborough and Pinellas crossed that threshold. And last month, Pasco joined them, according to new home sale numbers released Tuesday by Florida Realtors. Hernando’s median sales price remained the lowest at $246,000.

It’s just one way to slice the rapidly climbing prices in Tampa Bay, which reflect a nationwide trend. The National Association of Realtors said Tuesday that last month’s median price has climbed 23.6 percent year-over-year to $350,300, which includes single-family homes as well as townhomes, condos and co-ops.

“Lack of inventory continues to be the overwhelming factor holding back home sales, but falling affordability is simply squeezing some first-time buyers out of the market,” said Lawrence Yun, the national association’s chief economist.

Tuesday’s sales numbers release came on the heels of a report issued by the association last week that called the historic shortage of housing inventory “dire,” and estimated the gap between would-be buyers and homes available is between 5.5 million and 6.8 million homes.

Related: House inventory shortage ‘dire’ with gap of millions of homes, Realtors’ report warns

Tampa Bay’s lack of inventory is even more pronounced than the nation’s, likely because construction is limited by coastline.

The amount of housing inventory for sale is often measured in months, as in the amount of time it would take the current batch of for-sale homes to be depleted if sales held at the present pace. Nationwide, it would last two and half months. In Pinellas, Hillsborough, Pasco and Hernando counties, that number is less than one month.

Lou Brown, a longtime St. Petersburg Realtor with his own firm, said he saw one house in the Lakewood Estates neighborhood where the seller listed the home, got multiple offers, then re-listed it with the price jacked up by $100,000.

“It is an everyday thing,” he said.

That constant squeeze on supply has dampened sales in recent months, and May followed that pattern. Pinellas, Hillsborough, Pasco and Hernando all had slightly fewer closed sales in May than in April, and the national association said sales were down .9 percent. Demand hasn’t gone away, though, with sales still greatly higher than the same month last year, when the pandemic brought the economy to a halt.

“We are moving into the critical summer season, when the volume of real estate sales reaches its peak during a typical year,” said Realtor.com senior economist George Ratiu. “With four consecutive monthly declines, May’s sales activity signals a potential moderation in growth for the remainder of 2021.”

However, where the demand is coming from has started to shift: Compared to the same month last year, the number of May cash sales, which are more commonly used by investors, more than doubled in Pinellas and Pasco. In Hillsborough, it was nearly triple.

The National Association of Realtors said that the percentage of purchases by first-time buyers held steady from April at 31 percent, which is down three percentage points from one year ago. Meanwhile, buys by investors and second-home buyers are up year-over-year.

Brown said that some sellers are showing preference to individual homeowners over investors, but not all.

“The investors come in and it’s very hard to compete with an all-cash offer and very quick closing,” he said. “If you’re dealing with the person who has to get financing, it’s going to take more time.”