RI Home Prices Explode in Second Quarter - East Side Median Price Hits $682K, BI $1.28M
Wednesday, August 12, 2020
Housing prices during the pandemic are exploding in Rhode Island. The lack of inventory and out-of-state buyers are, in part, driving the increase in prices.
The Rhode Island Association of Realtors released second-quarter sales data the median price of a single-family home rose to $303,750, marking for the first time over $300,000.
The price increased by 4.2 percent from the second quarter of 2019.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTSingle-family home closing activity dropped 19.7 percent.
RI's Hot Spots
The East Side of Providence was one of the hottest markets. Prices increased year over year to a median price of $682,500 from $650,000 in the second quarter in 2019, on 44 transactions.
Little Compton jumped to $642,500 — a 16.8% increase in price.
Block Island saw an increase in sales — from 3 to 8 year-over-year and the price increased to $1.28 million.
The median price of condominiums rose 6.7 percent year-over-year to $245,750 and multifamily properties saw a median price increase of 12.2 percent to $295,000. Sales activity in both sectors fell significantly, by 38.2 and 29 percent, respectively.
Despite the fall in sales activity during the second quarter, data indicates the Rhode Island’s housing market is rebounding quickly. June sales data showed that sales activity rose 30 percent from May to June and preliminary data on July sales follow the same trend. Single-family homes under contract but not yet sold in June also rose by 13.7 percent from the prior year, an indication of increased sales ahead.
“We predicted that our ‘spring' market would happen in the summer and that seems to be happening. Multiple offers are rampant and bids over asking price are commonplace,” said Shannon Buss, President of the Rhode Island Association of Realtors. “At this point, the only thing that seems to be holding sales back at all is the shortage of inventory.”
Out-of-State Buyers Make Their Move
Second-quarter housing stats also show an influx of out-of-state buyers from higher-priced areas.
Fifty-nine New Yorkers, for example, purchased a Rhode Island property in the second-quarter despite the shut-down that curtailed the housing market for much of the quarter, compared to 60 during the same time last year. Massachusetts buyers totaled 367 this year, versus 392 last year. That figure represents a 6.4 drop in Massachusetts buyers compared to the overall 19.7 percent drop in sales from single-family home buyers overall. By all appearances, these out-of-state buyers may have helped Rhode Island’s housing market avoid even sharper drops in activity associated with the onset of the pandemic.
“Many are saying that remote working is making people reprioritize where they choose to live and work. It’s too early to say if we’re seeing a trend of people flocking to Rhode Island because it’s less expensive, more rural, has great amenities or a combination of all three, but it’s definitely something we’re studying. Rhode Island has always been a well-kept secret in terms of value, now perhaps, it’s not as much of a secret anymore,” said Buss.
