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RHODE ISLAND ASSOCIATION OF REALTORS®, INC.

"The Voice of Real Estate in Rhode Island"
Serving Rhode Islanders Since 1948
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Press Release

Contact: Kerry Park
Ph: 401-432-6948
Email: kerry@rirealtors.org

 

Home Prices Up, Sales Down in November

Warwick, RI, December 22, 2010…In November, the median price of single family homes rose two percent to $209,000, up from $205,000 in November 2009, according to statistics released today by the Rhode Island Association of Realtors.  The number of single family home sales fell 31 percent from a year earlier when sales were booming.  Single family home sales in 2009 were up more than 60 percent from November 2008 due to the impending expiration of the home buyer tax credit, initially scheduled to expire Nov 30, 2009. The deadline was later extended to contracts signed by the end of April and closed by June 30th which caused sales to drop precipitously in July.  Sales have remained relatively constant since that time. 

The number of single family short sales and foreclosures also continued to decrease last month, down 31 percent from a year ago. Twenty-three percent of all single family sales were sold through short sale or foreclosure last month.  Single family distressed sales had gotten as high as 48 percent of total sales in January of 2009.

"Sales are down, there’s no doubt about it, but we’re also comparing this November’s sales to a stellar year last year owing to the tax credit.  It’s hard to compare apples to apples given last year’s unusual incentive," explained Stephen Antoni, President of the Rhode Island Association of Realtors.

Sales followed the same suit in the condominium market in November with median price up 14 percent to $198,000 and the number of sales down 27 percent.  The number of distressed sales fell four percent from November 2009 to November 2010, and currently account for 24 percent of all condo sales.

Among multi-family sales, the median price rose nine percent, to $125,000 and the number of properties sold fell 35 percent.  The number of short sales and foreclosures fell 38 percent in a year.  However, 60 percent of all sales in the multi family market were still sold through short sale or foreclosure in November.

The rise in median prices does not reflect a rise in value of similar properties over time, but rather, a shift in the type of properties selling in the market.  Fewer short sales and foreclosures have shrunk the lower end market, and more lenient lending terms for larger mortgages and the inclusion of ‘move-up’ buyers in the tax credit helped spark the sale of higher end homes this year.

"We’re seeing some interesting shifts in the market," commented Antoni.  "From January through November of this year, there has been a decline in the number of homes sold under $300,000, but the number of homes sold for more than $300,000 has surpassed what we saw during the same time period in 2009," he said. "It could be that most first time buyers took advantage of the initial tax credit which was set to expire in November of 2009 which led to fewer sales of lower priced homes in 2010.  Plus, a tax credit for buyers who owned a home for five or more years was added to the mix in late 2009, leading to an increasing number of higher priced sales in 2010."  Sales of homes sold for more than $300,000 increased six percent while sales of $300,000 or less fell 18 percent from January 1 through November 30th.  Median price also rose for all price ranges except sales of $1 million or more.

The inventory of homes on the market increased among all property types while the number of properties under contract declined.  If that trend continues, prices could begin to fall in 2011.  Mortgage rates are also expected to climb, according to NAR Chief Economist, Lawrence Yun, which would offset gains in affordability if prices do fall.

"My advice right now is, if you don’t absolutely have to sell, wait until the market levels out but, if you are selling and you are willing and able to buy, everything is in your favor.  Interest rates are at their lowest levels ever, there is a good selection of homes to choose from at realistic prices, and lenders are becoming more eager to play ball with qualified buyers in all price ranges," said Antoni.  "Most important, it’s critical to look at real estate as a long term investment. Most people who followed that philosophy, have seen their equity rise since they purchased."

Note: Information is provided by State-Wide Multiple Listing Service, Inc. Readers are cautioned that the median sales price --- with half the prices higher and half lower --- generally reflects the quality and the mix (type and size) of the properties being sold at the time and is not a true measure of home values.

 

Stephen Antoni

2011 REALTOR®
State President

November 2010
Single Family Sales
By Town

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November 2010
Single Family Monthly
Sales Comparison

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November 2010
Multi Family Monthly
Sales Comparison

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November 2010
Condo Monthly
Sales Comparison

 

About the Rhode Island Association of REALTORS®

The Rhode Island Association of REALTORS®, one of the largest trade organizations in Rhode Island with more than 5,000 members in nearly 1,000 offices, has been serving Rhode Islanders since 1948. Advocating for Rhode Island's property owners, the Rhode Island Association of REALTORS® provides a facility for professional development, research and exchange of information among its members and to the public and government for the purpose of preserving the free enterprise system and the right to own real property. Last year, RI Realtors transacted $6.9 billion in residential real estate sales and $7.1 billion in total sales and rentals including commercial transactions.

The Association is one of more than 1,500 boards and associations that comprise the National Association of REALTORS® (NAR). The National Association of Realtors®, “The Voice for Real Estate,” is America's largest trade association, representing over 1.5 million members involved in all aspects of the residential and commercial real estate industries and who subscribe to a strict Code of Ethics.

REALTOR® is a federally registered collective membership mark which identifies a real estate professional who is member of the NATIONAL ASSOCIATION OF REALTORS® and subscribes to its strict Code of Ethics.