Is the Median Price of a Rhode Island Home Headed for $400,000?
Friday, July 16, 2021
The median price of a single-family home in Rhode Island has jumped again — in June the price rose 25% over 2020 to $385,000.
Just since January, the median price has jumped from $334,000 — a 15% increase.
At the pace of increase, Rhode Island would pierce the $400,000 price range by the end of the year for a single-family home. This marks the nearly doubling of the prices of a single-family home since 2010 -- which was recorded at about $200,000 in the state.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTBen Scungio of Mott & Chase Sotheby’s International told GoLocal, “I think a lot of it's coming from you a lot of homes selling in the secondary market and then a lot of communities like Barrington and the East Side of Providence are really pushing that number up and it's an exciting time -- it's an exciting time for sellers.”
Scungio adds that while the market is seeing an increase in inventory, it is still dynamic. "You're still going to have potentially three to four to five to six offers, all still exceeding usually the seller's expectation so we think and we feel strongly that the market is still going to remain strong -- the number of sales is still going to increase, the pricing is still going to increase."
His remarks are mirrored by the RI Association of Realtors, who report that the number of days a home stayed on the market fell by 50 percent from June 2020 to just 27 days, "one more indication of a frenzied market characterized by strong buyer demand and insufficient inventory."
Inventory
The inventory of single-family homes for sale increased, though the supply remained 31% lower than that reported in June 2020. The latest data shows that inventory would deplete in 1.7 months at June’s rate of sales, the highest level since November of last year. In May, RI Realtors reported less than a one-month supply of single-family homes for sale, approximately five months short of the supply typically characterized by a balanced market.
While sales activity increased 19.4% compared to 12 months earlier, a more telling indicator is the comparison to 2019, the year closings were unaffected by the economic shutdown. June sales in 2021 represented a 1.9% increase compared to the same period two years earlier.
“Low interest rates coupled with the historically low supply of homes available for sale are causing homes to sell more quickly and for more money than ever before. There needs to be some relief in sight, particularly for first-time homebuyers who are finding it nearly impossible to compete with buyers with top-tier credit and cash. We’re hopeful that the slight uptick we saw in inventory in June continues, as more people become comfortable with putting their homes on the market,” said Leann D’Ettore, president of the Rhode Island Association of Realtors.
Housing advocates are warning that while this market has been a boon to home sellers, the prices are a barrier to first-time homebuyers who are priced out of the market.
