Inside Tampa's plan to build more affordable housing as the city's popularity explodes

• Tampa, Florida, is one of the hottest cities to move to right now, especially for young people.
• With newcomers flocking in, the cost of a typical home has jumped 68% since January 2020.

Tampa is becoming a relocation hotspot.

The city of nearly 400,000 was among the top destinations for movers ages 18 to 24 in 2022, according to an analysis of census data by Today's Homeowner.

Tampa was also one of the most popular cities to move to among workers of any age last year, according to LinkedIn's workforce report — up there with Austin, Texas, and San Francisco.

Several 20-somethings told Insider they chose Tampa for its relative affordability, and small-town feel. Compared with many bigger cities, renting or owning a home can be cheaper.

But the influx of new residents is part of what's prompting concerns about affordability. Those worries are pushing the city to look for ways to get developers to build more housing — including affordable units, Tampa Mayor Jane Castor told Insider.

A quick scan of the Tampa market reveals the scope of the challenge: The typical home price in Tampa in July was $430,000, according to Redfin data, up 68% from the beginning of 2020. Overall, the cost of a typical US home went up 45% over the same period, per Redfin figures.

The average cost to rent a one-bedroom apartment in the city is $1,662 per month, up 6% since last year, according to Rent.com.

Castor said that with so many new residents moving in and buying up property, it's been hard for some middle-income homeowners looking to size up to find a place to move to — because there is such limited supply. Meanwhile, some of Tampa's renters are overwhelmed by the price hikes as a result of the new demand, she added.

"For residents of Tampa, it really has been a strange kind of burden," Castor said.

In order to ease the hardships that some residents are facing, Castor said the city is incentivizing developers to increase housing supply generally. This includes affordable-housing development.

One incentive Castor pointed to in a 2021 press conference allowed a local developer to add 31 apartments to a proposal for a 199-unit project. To get the extra units, the developer had to agree to make two dozen of the bonus residences affordable for the next 30 years.

Another incentive program awarded a local construction company three city lots at no cost and up to $225,000 to build homes and sell them to income-qualifying buyers.

Both projects support one of Castor's key initiatives: adding 10,000 affordable units to the city by 2027. So far, the city is more than halfway there.

Tampa officials are also setting up a community land trust comprised of city-owned plots. Typically, such arrangements let builders move ahead with projects if development plans include affordable or workforce housing.

In some cities that have also seen strong growth, Castor said, the influx of wealthier residents has pushed out lower-income families. Displaced residents often have to move to outlying areas and away from public transit — which can limit their options for getting around.

"That is something I've really taken to heart," she said.

To avoid this, Castor said she's eyeing land along transit routes to add to the land trust. That could make it so that those living in housing that gets built nearby won't necessarily have to rely on a car to get around. The aim is to help maintain economic and racial diversity throughout Tampa's neighborhoods, she said, and avoid displacement in neighborhoods that see an influx of wealthier residents.

"Our identity is rooted in diversity," Castor said. "We want people to live in the neighborhood they want to live in."