Life may return to normal after the pandemic, but the Rhode Island housing market has yet to cool as overseas buyers continue to flock.
The average single-family home sales price hit a record high of $ 385,000 in June, according to statistics released Wednesday by the Rhode Island Association of Realtors. That is almost 25% more than a year ago.
Real estate is also booked out faster: the average length of time apartments remain on the market has fallen by 50% since June 2020 to just 27 days.
The good news for buyers is that the number of homes in the market is increasing. In May, the Rhode Island Real Estate Association warned that there were fewer than 900 single-family homes for sale across the state, less than a month’s deal. There is now enough inventory for 1.7 months if sales continue at the current pace – still nowhere near the six month supply in a balanced market, but an improvement nonetheless, the group said.
“Things are hopeful again for buyers,” said Leann D’Ettore, president of the association. While many “just stopped looking and became discouraged,” a recent drop in mortgage rates coupled with the rise in offers has fueled renewed optimism, she said.
The fact that more homes are available for sale can be attributed in part to rising vaccination rates, which have made some sellers happier with the idea of strangers touring their home, D’Ettore said.
Another factor – along with an extremely cheap market for sellers – is that the state forbearance programs are due to end in September. That means homeowners who have been granted a fixed term because they ran into financial hardship during the pandemic will have to resume monthly mortgage payments.
“I think with this slowdown, people are saying, ‘I should sell my house,'” said D’Ettore.
Real estate agents speaking with The Providence Journal said the continued demand for homes is being largely driven by people fleeing more expensive areas of the country.
“The market is crazy here, but you can still get a lot more house for a lot less money than anywhere else,” said Luis Mateus, owner of Mateus Realty in East Providence.
Jess Powers, a realtor who counts shoppers as one of her clients, said Providence “has a strong appeal to Boston people” because it is less expensive and still has a strong local character. She has also partnered with a number of transplants from Austin, Texas, another city known for its music and food scene that is becoming increasingly unaffordable.
Northern Rhode Island has similarly “seen an influx of buyers looking in the Massachusetts market,” said Robert Williamson, a residential real estate agent who is also the head of the Northern Rhode Island Board of Realtors.
Nationwide, competition is toughest for homes that cost less than the average retail price of $ 385,000. Cash offers remain as common as buyers who forego an inspection.
As a result, some buyers are showing interest in more affordable areas that they may have previously overlooked, Powers said. While people in the Oakland Beach section of Warwick tend to “turn up their noses” this is starting to change and one of their clients was thrilled to find a home near Iggy’s Chowder House and a proposed new bike path .
Providence neighborhoods that could start an “uptrend” include Washington Park and Mount Pleasant, and the West End section between Broadway and Atwells Avenues, Powers said.
While the market may be daunting, people who can afford to buy now shouldn’t be put off, Powers added.
“When people start giving up, I say, ‘Listen, if you wait now and spend another $ 1,500 to $ 2,000 a month on rent, you might come back to me next year and prices will go up 8 or 9 percent be higher. “She said.