As prices fall, multi-family sales soar

Kevin Shalvey

02/05/2009

WARWICK – Multi-family home sales in Rhode Island rose 33.2 percent in 2008, led by a 92.9-percent year-over-year increase in the final three months of the year, according to statistics released today by the Rhode Island Association of Realtors.
The 1,670 multi-family home sales in Rhode Island last year amounted to a 416-sale increase from the 1,254 sold in 2007.
But the median price of those sales was about half of the median price of 2007 prices. Last year’s $135,000 median price represented a 47.1-percent drop from 2007’s $255,000 median multi-family price. Driving the price drop was the large percentage of homes – about 68 percent – that were either short sales or foreclosures.
“2008 was for buyers what 2005 was for sellers,” said RIAR President Paul A. Leys, who also is co-owner and broker of Gustave White Sotheby’s International Realty in Newport. “People are snatching up multi-family properties at bargain-basement prices, which is helping to reduce inventory.”
Almost one-third of the year’s sales came in the final quarter, with 542 multi-family homes selling in the final three months of the year. That represented a 92.9-percent jump from the 281 in the fourth quarter of 2007. The price of sales last quarter fell 51.2 percent to $105,000 from $215,000 in the same 2007 period.
“If you’re a buyer, there are tremendous deals out there, but the length of time and the complexity of the sales transaction have increased tenfold,” Leys said in a statement this morning. “Lenders are overloaded with foreclosure and short-sale paperwork.”
Multi-family home sales doubled in December, jumping to 202 from 101 sold in December 2007. The median price dropped to $95,450, a more-than-$100,000 fall from the $200,000 median price in December 2007.
Seventy-seven percent of December sales were either foreclosures or short sales.

The Rhode Island Association of Realtors has more than 4,700 member Realtors, who in 2008 were involved in 10,000-some transactions with a total value of $2.8 billion. The RIAR is one of more than 1,800 local boards and associations comprising the nation’s largest trade association, the National Association of Realtors. To learn more, visit www.RILiving.com.

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