RI’s Median Price for Single-Family Home Drops for Second Consecutive Month
Saturday, November 20, 2021
The median price for a single-family home in RI has declined for two consecutive months PHOTO: GoLocal
But, on the less positive side, the October prices were 12.7% higher than in October of 2020.
And, the number of homes on the market fell dramatically — down 22.3% year-over-year.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST“For the past 15 months, Rhode Island’s housing market has shattered records. Our housing market will likely show more tempered activity in 2022 but we still expect sales to remain strong. Our hope is that more sellers will be willing to list their homes if the frenzy of the market dies down and Covid becomes less of an issue. For many homeowners, the worry of finding a place to move to, is what is preventing them from listing their home for sale,” commented Agueda Del Borgo, President of the Rhode Island Association of Realtors.
Last week on GoLocal LIVE, realtor Robert Rutley of Mott & Chace Sotheby’s International said the dynamics for buyers is changing. He said that buyers are being more selective.
Sellers Pay Attention
For sellers, this decline in the median price for a single-family home may be a wake-up call to get their home on the market to take advantage of the height of the market.
Del Borgo said that Rhode Island has maintained less than a two-month supply of homes for sale all year. The norm is to have a six-month supply.
The spring selling is expected to be robust in part because of pandemic demand, but it is unclear if prices will continue to spike in 2022 as it did in 2021.
Condos and Multi-Family
Similar trends held for the condominium sector. Sales fell by 10.9% year-over-year while the median price rose to $270,000, a 9.8% increase from October 2020. In contrast to the single-family home market, however, pending sales rose 10.8%, an indication that frustrated buyers in the single-family home market may have turned their focus to condominiums.
The multifamily home market was the clear forerunner last month, with sales rising by 8.8% and the median price increasing 15.15% annually, to $380,000. An increase in pending sales of 11.2% also indicates that this sector of the market will remain strong in the months ahead.
“Our housing shortage has created great demand for rentals. High rents and an abundance of potential tenants are great enticements for investing in multifamily properties. The fact that Rhode Island is a vacation destination also provides some buyers in tourist areas with great potential for vacation rental income,” commented Del Borgo.
The number of listings was down in all sectors of the market. The conclusion of the mortgage forbearance moratorium and reduced worries about COVID could help mitigate the shortage in the year ahead.
X-Factor
The cost of renting continues to climb and in areas like Providence and Newport, there is simply little supply.
“Freddie Mac says that we need about 3.8 million homes in the United States just to make up for the housing everybody needs. That doesn’t have to be single-family homes, it doesn’t need to be multi-families or condos - it can also mean rentals,” said Rutley. “So right now we’re seeing that rentals are really hard to come by.”
“Everything is renting really quick — we’re getting multiple offers on the very few rentals we support and there is a constant request for rentals when they’re listed,” he added. “So it’s a tough situation for people looking for housing across the board.”
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