MARKET SNAPSHOT
In 2024, approximately 12,500 multifamily units were completed in the Tampa market, surpassing the previous high set in 2022 by more than 4,000 units. Pasco County and Southeast Tampa have dominated construction activity in recent years, primarily due to the availability of developable land. These two submarkets alone accounted for nearly half of Tampa’s completions over the past 12 months. Meanwhile, Downtown Tampa also saw significant development, with the addition of over 2,300 units delivered in several high-rise multifamily projects.
Looking ahead, the market faces continued but easing supply-side pressure, with approximately 11,000 units under construction as of early 2025. Pasco County, Southeast Tampa, and Downtown Tampa again represent the largest contributors to this pipeline, collectively accounting for around 5,400 units. However, the pace of new construction has begun to decelerate. Fewer than 350 units broke ground in the fourth quarter of 2024, the lowest quarterly total in nine years—and the overall pipeline has contracted by nearly 40% compared to the same period last year.
While 2024 set a record for completions, the delivery schedule for 2025 and 2026 suggests a sharp slowdown, with approximately 7,400 units expected in 2025 and only 3,500 in 2026. This tapering of new supply is expected to reduce competitive pressures on the rental market, driving vacancy rates lower in less supplied submarkets and paving the way for a meaningful rebound in rent growth.
Tampa’s multifamily market saw a historic surge in renter demand in 2024, surpassing the strong absorption figures of 2021. Over the course of the year, nearly 9,400 units were absorbed, setting a new benchmark for the region. At the same time, Tampa recorded a new high in multifamily completions, delivering approximately 12,500 units—4,000 more than the previous record. This supply-demand imbalance resulted in a 30-basis-point annual decline in the average stabilized occupancy for the market by the fourth quarter of 2024.
Property managers noted a temporary uptick in leasing activity during the final months of 2024, largely driven by displaced residents seeking housing after Hurricanes Helene and Milton. However, vacancies remain unevenly distributed across Tampa’s submarkets. Pasco County and Southeast Hillsborough, in particular, have experienced a wave of new deliveries in recent years, contributing to higher vacancy levels.
New supply will continue to weigh on the market through the first half of 2025, though its impact is expected to ease compared to prior years. Net absorption is forecast to remain healthy, with nearly 6,000 units expected to be absorbed over the year—a figure that surpasses Tampa’s 10-year average. Despite this positive momentum, the market’s average occupancy rate is projected to decline slightly, with a modest 10-basis-point dip by year-end 2025.
One factor to monitor is tenant retention among residents displaced by the late 2024 hurricanes. If a significant portion opt not to renew their leases, it could dampen net absorption and create additional headwinds for the market.
12-month period ending November 2024
Tampa’s multifamily market in 2025 is expected to follow a moderate yet positive trajectory, driven by sustained population growth and strong economic fundamentals. Tampa Bay has consistently ranked as one of the fastest-growing large U.S. metro areas, with the region’s GDP increasing by 4.3% to reach $198 billion, according to the latest data from the Bureau of Economic Analysis. Key industries such as finance, insurance, real estate, and healthcare have been pivotal in driving this growth, collectively contributing over $72 billion to the local economy. These economic gains, coupled with Tampa’s strong in-migration trends, underscore the region’s ongoing appeal to both businesses and residents. The metro contains three of the top 25 fastest-growing cities in the U.S., with Sarasota, Tampa, and Lakeland showcasing significant expansion, fueled by new employment opportunities and lifestyle amenities.
Despite these tailwinds, Tampa’s multifamily market will face some headwinds in 2025, primarily due to lingering supply-side pressures from record completions in 2024. With approximately 11,000 units still under construction and set to deliver this year, vacancies may remain elevated in select submarkets, particularly Pasco County and Southeast Hillsborough. However, net absorption is projected to remain strong, with nearly 6,000 units expected to be absorbed, surpassing the market’s 10-year average. A reduced level of construction starts in 2024, and a tapering development pipeline are expected to alleviate pressure on vacancy rates over the long term, fostering conditions for rent growth to stabilize and gradually approach the long-term average. Although the past couple of years have been challenging from a rental revenue perspective, the anticipated return of positive, albeit modest, rent growth in 2025 is a promising step toward a quicker recovery of fundamentals in the Tampa multifamily market.
