RI Housing Market Showed Signs of Solid Economic Recovery in 2013
Wednesday, January 08, 2014
Significant growth in 2013
Rhode Island Multiple Listing Service (RIMLS) data shows Rhode Island experienced significant growth in single-family, condominium and multi-family transactions. In 2013, single-family home sales increased 10.7% compared to 2012. Condominium sales increased 32.5% – the largest increase in New England, and multi-family transactions rose 2.1% year-over-year.
“2013 was absolutely gangbusters,” said Karl Martone, a Sales Associate with RE/MAX Properties in Smithfield. “We had a very robust November when it’s traditionally slow in the market. This is due to very low inventory and a wealth of buyers who are in the market trying to find a home and beat the interest rate rise.”
Martone commented that sellers are more hesitant to put their homes on the market right now, fearing that they will not get the best price on their property. However, those who do are in a pool of very serious buyers.
Average median price also demonstrated similar growth. Single-family home prices increased 7.4% to $206,870, the second largest jump in the region. Condominium prices increased 17.0% to $191,559 year-over-year, the highest price increase in this category in New England. Multi-family pricing increased 6.9% to $128,327.
Martone is seeing a lot of first-time buyers looking to move from rental situations and take advantage of good rates and pricing in the Ocean State, as well as consumers looking to build their retirement portfolios. “In addition to those buyers who are just starting to enter the market, we’re also seeing folks who are taking advantage of affordable pricing for investment purposes down the road. These two segments are absolutely driving the condominium market in Rhode Island.”
While first-time home buyers continue to largely fuel Rhode Island’s housing market, Martone added that move-up buyers are back in the mix. “Move-up buyers are finally realizing some equity in their homes again and can afford to sell and purchase the larger home that their growing families need. The number of buyers versus sellers is also becoming more balanced."
Outlook for 2014
“I expect to continue to see a more balanced market in 2014,” said Martone. “Key factors that could affect the industry include new flood insurance laws, interest rates and qualified mortgages.”
The one segment of the market that has seen a decline according to Martone is the luxury market. “2012 was a great year for luxury real estate in Rhode Island. But, with the exception of Taylor Swift’s $18 million home in Watch Hill in the spring of 2013, we have seen stagnation in this segment of the market.”
Martone added that the majority of homes on the market in the Ocean State do not fall into the luxury real estate category and expects 2014 to be on par with 2013.
“I expect Rhode Island’s 2014 real estate market to return to a traditional, balanced market,” Martone concluded. “The realtor is key to the transaction and needs to educate and guide clients to make the best possible decisions.”
The rest of New England
Housing transactions in Connecticut, Massachusetts, New Hampshire, Rhode Island and Vermont regularly tracked double-digit increases month-over-month as serious buyers clamored to purchase a home before interest rates ticked up. With foreclosure and short-sale inventory diminishing across New England and median prices increasing, investor activity slowed as the competition with homebuyers piqued in the summer months. Despite interest rates that rose more than a point in a few short weeks in August, averaging close to 5.0% – the highest since 2011 – consumers battled to get deals done, fearing rates would continue to rise based on renewed consumer confidence and solid employment statistics, according to the report.
RE/MAX of New England data shows significant year-over- year growth in most regions leading into the winter months. “The traditionally slower fall/winter months showed very strong activity in key markets across the region,” said Dan Breault, Executive Vice President and Regional Director of RE/MAX of New England. “This is an excellent bellwether of how we can expect the first quarter of 2014 to shape up.”
Related Slideshow: 10 Most Expensive Properties For Sale in RI
Take a tour of the 10 most expensive properties on the market in Rhode Island...
#10: 125 Kenyon Farm Road
3 Beds, 1 Baths
Kenyon Farm is 65 acres of pristine land, bordering Point Judith Pond, including 6 waterfront cottages, 3 docks, and out buildings. A private compound, with abundance of nature's beauty and ocean access.
#9: 589 Beavertail Rd.
5 Beds, 6 Bath
Exceptional oceanfront location, perfectly sited with commanding waterviews and nestled in a park-like setting, this gracious, architecturally designed home lends itself to comfortable living and is defined by elegance, sophistication and beauty.
#8: 41 Ledge Rd.
8 Beds, 6 Baths
"Plaisance" is an elegant oceanfront manor house in an exceptionally beautiful setting. West-facing and featuring a private sandy beachfront. Manageable in scale and size, with beautiful rooms for entertaining. Glorious sunsets.
#7: 5 Hammersmith Rd.
6 Beds, 5 Baths
Historic Moorland Lodge is an exceptional 13.64-acre estate with a 7-bedroom manor house, 2-bedroom cottage, 2-bedroom carriage house, all impeccably renovated. Includes separate 3.75-acre lot with barn and shed. Pastorally perfect.
#4 (T): 1 Tower Drive
5 Beds, 5 Baths
Breathtaking 360 degree views of the ocean, bridges, equestrian facilities and golf course on 450 acres from this state of the art residence. Gracious seaside living with every possible amenity. Includes private poolside cabana, and roof top decks.
#4 (T): 36 Beacon Hill Rd
7 Beds, 7 Baths
Enter "Wyndham Estate" through one of two gated entrances to one of Ocean Drive's highest elevations. Spectacular ocean view panoramas. This stone Baronial style estate has just undergone extensive restoration. Extra lot included and a second lot available.
#3: 9 Manatuck Avenue
5 Beds, 5 Baths
Stunning oceanfront home, in-ground pool, magnificent sunrises, views from Weekapaug, Block Island, to Watch Hill Lighthouse. 2,400 square feet of decks and an open living area make this home ideal for entertaining.
#2: 21 Hammersmith Road
9 Beds, 6 Baths
Meticulously restored McKim Mead White/Olmsted estate "Wild Moor" on 23+ gated, scenic acres overlooking ocean and Newport Country Club. Magnificent stone main house, 2-unit carriage house, cottage and numerous outbuildings. Heliport approved.
#1: 254 Ocean Avenue
8 Beds, 11 Baths
Seafair is an entire gated oceanfront peninsula. Gracious interiors, state of the art amenities, 8 ensuite bedrooms, estate drive, expansive terraces, ocean-facing pool, carriage/pool house, tennis, and garages. Condominium rights retained; development opportunities. Or just estate living.
- NEW: RI Leads in Year-Over-Year Home Sales Increase—RE/MAX
- NEW: Rhode Island Home Sales Up 34% in RE/MAX of NE July Report
- NEW: Encouraging Growth in RE/MAX November Housing Report
- NEW: RE/MAX New England 2013 Housing Forecast Projects Growth
- NEW: RI Home Sales Are Up Nearly 25% - RE/MAX