Prices soar as RI real estate enters seller's market

Posted 6/21/18

The median price of single-family homes sold in Rhode Island reached $275,000 last month, which represents the highest monthly median sale price since August of 2007 and is a ten percent increase over the median value of $250,000 in May of 2017,

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Prices soar as RI real estate enters seller's market

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The median price of single-family homes sold in Rhode Island reached $275,000 last month, which represents the highest monthly median sale price since August of 2007 and is a ten percent increase over the median value of $250,000 in May of 2017, according to a report released by the Rhode Island Association of Realtors and its subsidiary, State-Wide Multiple Listing Service.

Single-family properties remained on the market just 49 days before selling, the shortest time frame in nearly 14 years, and the number of listings increased from 3,190 in April of 2018 to 3,715 in May. However, the total number of homes for sale continued to fall year-over-year, continuing a trend of tightening inventory that began in 2015. The diminished supply resulted in a 7.6 percent drop in overall home sales compared to a year earlier.

This reality was drastically reflected in Warwick, which saw 47 fewer homes sold this May versus last May, representing a more than 32 percent decrease in the number of homes sold. In Warwick, the median price increased from $221,000 in 2017 to $231,500 in 2018. On average throughout the entire state, median house prices jumped from around $321,500 in May of last year to about $350,000 this May.

“Competition is fierce and buyers are finding themselves in a race to the finish line. Inventory is so tight that properties are being sold as soon as they go on the market, often in multiple bid situations,” said Joe Luca, President of the Rhode Island Association of Realtors. “Fortunately, the market isn’t being fueled by lax lending rules as we’ve seen in the past – just by pent-up demand.”

Condo market still strong

The median condominium sales price rose to $221,000 in May, a 7.8 percent gain compared to 12 months earlier. Like the single-family home market, listings sold quickly and inventory continued to drop, falling 5.7 percent from May 2017. In contrast to the single-family home market however, sales activity in the condominium sector has been up over last year throughout 2018. Completed transactions increased 15.1 percent last month.

Investor-driven multifamily property sector sees increase in inventory

The median price of multifamily property sales has skyrocketed, rising roughly 20 percent or more from a year earlier every month this year. A 21.2 percent increase from the prior year brought May’s median sales price to $241,107. In stark contrast to the single-family home and condo markets, inventory increased 16.1 percent since the same month last year. Sales activity has also been strong with May marking the sixth consecutive month of increased sales.

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