Still house hunting? Here’s how to navigate Tampa Bay’s tough real estate market

Stubborn inflation and high interest rates have created challenges for buyers. Local experts share their advice.
A home for sale, 541 Locklie Street, on Thursday, Jan. 28, 2021, in Dunedin.
A home for sale, 541 Locklie Street, on Thursday, Jan. 28, 2021, in Dunedin. [ DOUGLAS R. CLIFFORD | Times ]
Published Jan. 31|Updated Feb. 5

This time last year, it seemed like the entire Tampa Bay area was caught up in a home buying frenzy. But as we enter 2023, the tide has changed considerably.

High interest rates, stubborn inflation and the threat of recession have caused many to tighten their purse strings and defer their dreams of homeownership.

Home sales in Tampa, St. Petersburg and Clearwater were down 36.9% year over year, according to December data from Greater Tampa Realtors. That trend may continue through the end of the year as the market stabilizes.

We spoke with local real estate pros about how to navigate the home buying process during uncertain economic times. Here’s their best advice.

Research homebuyer assistance programs:

Buying a home is likely the biggest purchase you will make in your lifetime and it’s a decision that should not be rushed. Still, there’s never going to be a perfect time to buy.

Manuela Hendrickson, the owner of St. Petersburg real estate brokerage, Global LifeStyle, said many first-time buyers make the mistake of waiting around for the market to crash so prices will drop.

“That’s not going to happen here,” she said, noting that the Tampa Bay market has seen steady growth for the past several years.

Luckily, there are many incentive programs out there for buyers who are prepared to make a long-term financial commitment but need a little extra help to get started.

Hendrickson highlighted the Florida Hometown Heroes Housing Program, which gives up to $25,000 in down payment assistance and reduced mortgage rates to qualified buyers in dozens of different professions including law enforcement, educators, health care workers and military personnel.

The Florida Housing Finance Corporation, which administers Hometown Heroes, has a tool on its website to help determine which state-run programs you may qualify for.

There are also several local programs to consider including:

Check out new construction homes:

If you’ve had no luck finding a home in your budget on the resale market, consider broadening your search to include spec homes.

“Builders are desperate right now to sell because they don’t want to lose money on the construction they’ve already started,” said Lei Wedge, a professor of finance at the University of South Florida Muma College of Business.

This means many builders are dropping their sales prices. Wedge said some builders are even offering to subsidize mortgage rates for a certain number of months in order to seal the deal.

Explore different loan options

Gone are the historically low interest rates that buyers enjoyed during the early days of the pandemic. Though it may be tempting to just choose the loan with the lowest rate, “that’s not the only thing to consider,” said Jane Floyd from NFM Lending.

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Explore all your options

Buyers should take a hard look at their budget and determine what kind of monthly payment they are comfortable with and how much cash they can afford to put up at closing.

Many lenders have special programs for first-time or low-income homebuyers. Every program has different qualifications and benefits, so take the time to shop around.

“Don’t just hop online and choose the first offer,” Floyd said. “Work with an experienced local lender who can give you all the facts.”

Floyd says rates have already started to come down from the 7% peak we saw last year, and they may continue to fall further.

This could make an adjustable rate mortgage an attractive option for some buyers. Floyd said many buyers are also looking into 2-1 buydown loans, which provide a reduced rate for the first two years.

Make sure to factor in added costs

While you may be able to afford the sticker price of a new home, you also need to account for things like home insurance, flood insurance and taxes.

“When you look at the current property taxes for a home… they’re likely a lot lower than what you’re going to pay the following year,” said Carol Hasbrouck, an agent with Charles Rutenberg Realty.

That’s because many homeowners have the homestead exemption, which caps their annual tax increases.

Hasbrouck recommended checking the tax estimator tool on your county property appraiser’s website to get a more accurate picture of the taxes you may be paying.

Speaking with an insurance agent early on will give you a better picture of what kind of coverage you may need and how much your payment will cost.

The Tampa Bay Times has a team of reporters focusing on rising costs in our region. If you have an idea, question or story to tell, please email us at

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