Is the Housing Recovery Stalling?
Wednesday, May 25, 2011
New numbers released today show that housing-market recovery may be stalling. According to the President of the Rhode Island Association of Realtors, the loss of the federal tax credit coupled strict lending is adversely affecting pricing and sales in RI and across the country.
Single family housing sales fell 26 percent in April from a year earlier, marking the tenth consecutive month of year to year decline, according to numbers released today by the Rhode Island Association of Realtors. Median price also fell, down seven percent from April 2010 to $190,000, reversing an upward trend in median price that began in November, 2009. April sales volume and median price did rise slightly from the previous month however, up .4 percent in the number of homes sold, and median price rose two percent.
Condo sales dropped 16 percent from a year ago and median price fell 11 percent. Multi-family sales fell 31 percent and prices rose a scant .4 percent.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST“After months of positive movement, we’ve seen negative numbers in Rhode Island’s housing market recently,” said Stephen Antoni, President of the Rhode Island Association of Realtors. “If you’re a cash buyer, this is the market for you, but if you need a loan, rigorous lending requirements are making it difficult for even very credit worthy buyers.”
Some degree of the decline can be attributed to the tax credit in place last spring which pushed home sales upward. April, 2011 sales however, remained below the sales level of April 2009 when no tax credit incentive was in place.
Antoni said that many believe that rising gas prices may also be a factor in dampening the housing market’s recovery. The Rhode Island statistics echo numbers released by the National Association of Realtors last week which also showed sales and prices to be down across the country.
In Rhode Island, foreclosures and short sales continued to decline among single and multi family sales but rose 50 percent among condo sales.
“Colleagues are telling me that they’re seeing an increase in activity,” said Antoni. “When comparing this year’s market to last year however, the effects of the tax credit could exaggerate sales decline until the end of June, when the last of 2010’s tax credit sales moved through the market.”
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