Price Insanity—House on Federal Hill Selling for 900% Higher Than It Sold for 14 Years Ago
Friday, April 16, 2021
Who would think that houses on Providence’s Federal Hill would increase nearly as fast as Apple stock or Bitcoins — but the new reality for real estate in Providence is explosive price increases and not just on the tony East Side of Providence.
Maybe no home in Rhode Island demonstrates the state of the real estate market more than the house at 124 Depasquale Avenue on Federal Hill.
In 1993, the City of Providence announced that it had secured millions of federal funds to build new homes for low-income first-time home buyers.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTThen-Mayor Vincent "Buddy" Cianci announced that in partnership with a developer the city was building 21 single-family homes — on Depasquale Avenue and Federal Street. The homes at the time would sell for about $80,000 and be marketed to first-time home buyers.
"This is an old neighborhood," Cianci said at the time, standing in front of 42 Penn Steet as construction workers shuttled in and out of the three-story boarded-up house behind him. "What's happened to this neighborhood we will not allow to happen any further."
The homes were intended for families who had earnings of 115% of the city's median income level, or about $40,000 for a family of four, according to the announcement of the project in 1993.
As part of the project, one of the homes in the project was 124 Depasquale Avenue — it was built in 1994. It sold for $40,000 in 1994.
The 3 bedroom, 1,600 square foot house is now on the market for $395,000.
Here is the travel of the home's pricing:
By 2007 that home sold for $40,000.
In 2011, the property sold again — this time for $86,500.
By 2012, it was sold again — then the price jumped to $178,000.
In 2014, the present owner purchased for $247,001
Now, at the height of the real estate market — the home is priced at nearly $400,000 — and that is just the asking price.
The City of Providence assesses the value of the property at $303,900 for purposes of taxes.
Record Low Inventory
For those looking to buy in Providence in the $400,000 range, 124 Depasquale may be highly desirable. As GoLocal reported on Thursday, the number of homes for sale for the spring season in Rhode Island is the lowest on record.
With just 1192 single-family homes on the market in Rhode Island, the current inventory is approximately 25% less than the previous monthly record low of 1594 in the spring of 2002, said the RI Association of Realtors.
Not only has the number of single-family homes for sale averaged roughly half of that recorded during the first quarter of 2020, there seems to be no letup in sight.
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