SOUTH TAMPA — Young millennials are making their debut in the housing market in Hillsborough County, albeit a little late.
According to area real estate professionals, first-time homebuyers in their 20s and early 30s are often priced out of the new construction market with few entry-level choices.
Ashley Christie, 25, a Realtor with Coldwell Banker in Carrollwood, said most of her fellow millennials hunting for homes can typically afford townhomes or single-family homes between $100,000 and $150,000.
“It’s difficult, especially in Tampa,” she said. “The prices have been going up and there are still a lot of young buyers out there. If something is in good condition in the $100,000 to $150,000 range, there are multiple offers.”
Although new construction is appealing to millennials because of the energy efficiency and low maintenance, Christie said most who can afford new construction homes are move-up buyers on their second or third homes.
“I think millennials are renting until they can afford more, but rents are high,” she said. “If they are paying $1,200 for rent, they are thinking, ‘Why don’t I start looking at a home?’”
Christie said one option for cash-strapped millennials is the City of Tampa’s revitalization project in the Sulphur Springs neighborhood, where homes are selling for around $85,000. Buyers have to have an income less than 120 percent of the area’s median income, or about $48,200 for a single person, but those who qualify can get down payment assistance from the city.
Isaac Lidsky, the chief executive officer with ODC Construction, said his company is hired by custom and production homebuilders in the Tampa area to build the “shell” of new construction homes, such as foundation and walls. He said builders and contractors are waiting to see how millennials will affect building trends.
“The recent demographic trend toward waiting longer to start a new household would seem to imply a trend away from the classic starter home,” Lidsky said. “But the new home supply has remained so depressed for so long that one would think we’re due to build a lot of entry-level product any way you slice it.”
Builders are catering to homebuyers who want them to design homes with more square footage as showpiece custom homes as well as homes to accommodate multi-generational households.
“The recent, positive trends in Tampa certainly suggest that homebuilders who offer larger, custom homes are coming back into the market and beginning to thrive,” Lidsky said, adding many homebuilders are creating “flex spaces” to give individuals more options. “We definitely see greater diversity in the homes our customers are designing. Homebuilders understand that these days new homes are expected to perform for a particular demographic or context.”
Irene Gray, a Realtor with the Gray-Roberson Team in South Tampa, said many millennials are willing to buy a less extravagant home.
“The young professionals want to be in the South Tampa area,” said Gray, adding that many of them work downtown. “Also, due to the location, this area is very active for single or young married couples. They will settle for one- or two-bedroom townhomes or condos.” She said older millennials, often with children, settle for single-family homes with less square footage just to live in South Tampa.
“If this area does not meet their home needs/wants and budget, they may go to Brandon, Lutz, North Tampa and the Carrollwood area,” she said.
Christie, who rents in the Town ’N Country area, said she can relate to her young real estate clients who want to own a home. She recently attended a Florida Realtors conference in Orlando where she heard from a panel of millennials who talked about what they want in terms of a home purchase.
“I am torn because I know all the benefits of new construction but I like older homes with character,” Christie said.