Activity Building in Rhode Island's Housing Market

Activity Building in Rhode Island's Housing Market

Warwick, RI, May 28, 2015…The number of Rhode Island’s single family home sales rose two percent in April from 12 months earlier, while the median price of single family homes sold fell by five percent. April’s moderating market was the result of harsh winter weather in February and March, according to the Rhode Island Association of Realtors, which released April’s Rhode Island home sales statistics today.  Last month, Rhode Island saw the biggest jump in pending sales since September, 2012 - an increase of 21 percent.  Those sales under contract should translate into closed sales in upcoming months.

Unlike most of the country which has seen a lack of inventory in the housing market, Rhode Island maintained a 7.5-month supply of single family homes for sale in April, slightly more than the industry standard of six months that typically indicates a market balanced between buyers and sellers.  Though the number of homes for sale in Rhode Island this year has remained below that of last year, the slight oversupply of homes on the market is providing buyers with a slim advantage. However, the increased sales expected in May and June should balance seller supply and buyer demand if inventory levels stay below that of last year.

“As we expected, we have seen some fallout on sales from the snowfall we experienced a few months ago, however that will be short lived,” said Bruce Lane, President of the Rhode Island Association of Realtors.  “While the spring sales season has started a little later than usual this year, I think we’ll see a solid housing market from this point forward,” said Lane.

The multi-family market provided more insights to a strengthening market.  Investor-driven multi-family home sales trends are often a sign of things to come for the market overall. In April, multi-family home sales activity rose 36 percent, median price increased 18 percent and sales under contract rose eight percent.  The median price of multi-family home sales, which had fallen as low as $69,900 in April, 2009, reached $163,800 last month.

The condominium market also began to see signs of improvement after several months of hardship.  Sales activity remained flat in April, while the median sales price rose four percent to $179,500.  Sales under contract also rose a substantial 10 percent following five months of decline.

“There’s no doubt about it, if consumers have any thoughts of purchasing a home, now would be a great time to do so. Interest rates have begun to creep back up in recent weeks but they still remain low.  If they wait, not only may buyers have less inventory to choose from, they might have to deal with higher mortgage rates.”