Susan Martins-Phipps serves as Realtor emeritus at the Phipps Team at Compass Inc. Previously, she served as chairperson of the Rhode Island Association of Realtors’ Government Affairs Committee, in addition to being a member and past chair of the association’s Diversity Equity and Inclusion Committee.
Martins-Phipps has been a licensed real estate agent in Rhode Island since 1978 and a state-certified residential appraiser since 1993. She has also been a Massachusetts-licensed agent since 2009. Martins-Phipps has a bachelor’s degree from Providence College, she holds a master’s degree in education from Rhode Island College and she did graduate work in holistic counseling at Salve Regina University.
PBN: When we last spoke, we focused on new landlord-tenant laws in Rhode Island. Now that some of these policies have had time to take effect, what impact are you seeing on rental housing and landlord behavior?
MARTINS-PHIPPS: Recent changes to Rhode Island’s landlord-tenant laws, along with stricter enforcement of the state’s lead hazard requirements, have had a noticeable effect on the rental housing market (landlords, sellers and buyers), particularly for 2- to 4-unit properties.
Mainly, the goal of these policies was to increase transparency, extend notice periods and require formal compliance with fee disclosures, lead laws and rental property registration. Hopefully, the net result improves tenant protections and housing safety in the long run. However, lead inspections have been difficult and costly to attain due to a shortage of inspectors and have become an administrative burden for landlords.
The impact on the market has led to more conservative investor behavior, tighter tenant screening and greater emphasis on documented compliance. Properties that are fully compliant, especially with lead certification and rental registry requirements, sell quickly at higher prices. The properties that are non-compliant are on the market longer, sell for less and often need closing cost or repair credits to close. We are seeing lenders demand that properties comply before issuing the loan.
PBN: You bring a unique perspective as both a certified appraiser and long-term real estate professional. How are current market conditions affecting property valuations across Rhode Island right now?
MARTINS-PHIPPS: Inventory remains low (down about 6% year over year) despite the promise of a spring market. Currently on the market, there are 943 single-unit dwellings (ranging in list price from $40,000 – a mobile home in Middletown, to $22.5 million – a Little Compton waterfront home; with the median list price at $639,000 – a 2,300-squaure-foot ranch in North Providence); 260 residential condominiums (ranging in list price from $132,000 – a one-bedroom in North Providence, to $20 million – at Ocean House in Watch Hill [in Westerly]; with the median list price at $435,000 – a three-bedroom in Smithfield); and 265 multi-units, two through four units (ranging in list price from $260,000 – a two-unit in Woonsocket to $3.35 million – a three-unit in Middletown; with the median list price of $699,000 – a two-family on Smith Hill in Providence). There is about a two-month supply of inventory – less than half the national average – so Rhode Island is still firmly entrenched in a seller’s market.
The anticipated mortgage rate cuts have not happened and that continues to limit the buyer’s purchasing power. Prices continue to rise year over year; however, the rate of appreciation has moderated. We do see a change in that it appears the market is adjusting not by lower sales prices but by the terms of the sales. We had witnessed offers with no contingencies (no financing or appraisal requirements, inspection waivers), escalation clauses, and/or large deposits.
Today, buyers have become more price- and rate-sensitive and more selective. The days on the market are increasing. Many listings do not sell on the first weekend or at the first open house. We had been getting multiple offers – seven to 10 or more – on a property. We are now seeing two or three offers.
PBN: Affordability continues to be a major concern in the state. What are the biggest structural challenges driving affordability issues, and are there any meaningful solutions on the horizon?
MARTINS-PHIPPS: R.I. has been underbuilding for years. We have a severe housing shortage. Since at least 2020, we have witnessed the housing inventory cut in half while the prices have risen dramatically (median price jumped from about $322,000 to $518,000).
No Rhode Island municipality is considered affordable any longer. There are not enough homes, at any price point, to meet the demand.
Despite the recent state legislative housing initiatives, the local approval process is costly and lengthy with uncertain outcomes. Add to that the high cost of land, the high cost and shortage of labor, regulatory compliance, and high financing costs.
Many of the smaller developers are no longer building. Well-intentioned regulatory policies are increasing the cost and complexity of the building process, impacting supply. Much of the new construction that we are seeing is luxury or high-end units, not workforce or starter housing. Additionally, the income required to purchase/finance a median price home is $130,000, and R.I.’s median household income is $86,000. Approximately one-third of R.I. households spend more than 30% of the income on housing.
The demand is further exacerbated by an inventory freeze. Those homeowners that were lucky enough to secure a mortgage for 2%-3% not that long ago are not willing to give that up; they are not moving up, freezing the market with fewer entry-level properties. According to the National Low Income Housing Coalition, in R.I., only 54 rental homes are affordable and available for every 100 extremely low-income renters. R.I. needs about 23,000 more affordable units for low-income households.
The legislature is pushing for solutions. The Housing 2030 goal of 15,000 new units by 2030 is helpful but not enough. We have seen some zoning reforms pass in the last couple of years (accessory dwelling unit legalization, density increases, adaptive reuse, housing bonds, etc.). The statewide ADU legislation was a major structural shift. This could have significant impacts on housing supply, however there are still major restrictions to build by right (large lot size needed, owner occupied, rental bans). Less than 100 ADUs were built and issued Cos [certificates of occupancy] in 2025. Even with state reforms, the municipalities still control setbacks, parking, dimensional rules and approvals. Each municipality interprets the laws differently, creating uncertainty, delays, frustrations and inconsistent outcomes.
So while the state is encouraging development (streamlining permitting, encouraging density), they are adding regulatory layers, increasing compliance costs and maintaining local control.
The recently added new tax burdens (the Non-Occupied Owner Tax, aka The Taylor Swift Tax, and the increased Conveyance Tax) are further reducing investment in housing stock. We are already seeing a market reaction to these new taxes. With lower projected returns, and higher operating costs, there will be less reinvestments, fewer renovations, fewer upgrades. We are already seeing some investors leaving the market or R.I. entirely.
What is short-sighted about these increases is that the higher the taxes, the higher rent is required to justify ownership. The higher conveyance tax further discourages turnover, further limiting inventory. These taxes are burdening the small, local investors and landlords, increasing costs and decreasing accessibility for tenants, hurting the housing market overall.
PBN: In your role with the Rhode Island Association of Realtors, how are you seeing policymakers and the real estate industry working together – or not – on housing-related legislation?
MARTINS-PHIPPS: Our Government Affairs Team monitors the proposed and pending legislation very closely. We offer support when warranted, opposition when needed and solutions when asked. We are able to provide the legislators with an abundance of data (active listings, months of supply, permit issuance by municipality, pricing trends, vacancy levels and trends, housing forecasts, etc.). This can enable policy to be data driven rather than anecdotal. Policy development always works best when several subject matter experts are at the table from initial concept through to passage. We welcome the opportunity to be involved at the bill drafting stage to engage in conversation, to propose solutions and to offer housing impact studies on any new tax.
PBN: Looking ahead, what trends – whether regulatory, economic, or demographic – will most shape Rhode Island’s housing market over the next few years?
MARTINS-PHIPPS: Typically, the housing market is shaped by traditional supply-and-demand economics. However, years of underbuilding, regulatory uncertainty and aggressive tax policy are further exacerbating our already tight housing supply. As far as Rhode Island’s legal and regulatory environment is concerned, the contradictory policies previously described, where development is supported on one hand but is made more costly and difficult on the other, will continue to stifle supply while demand continues to increase. This will slow our progress in alleviating the housing crisis. With 39 cities and towns acting independently, it’s difficult to create the synergy needed to move forward.
Given the affordability issues caused by the housing shortage, there has been interest in rent control legislation. While well-intended, we will witness the negative unintended consequences evidenced in other cities and states with rent control laws. Will investors curtail new acquisitions? Will landlords raise rents in anticipation of passage? Will property improvements be delayed?
The exorbitant conveyance tax increases of 2025 (from $4.60/$1,000 to $7.50/$1,000 – about a 63% increase, plus a second-tier tax on sales over $800,000 of an additional $7.50/$1000 – adjusted for inflation as of January 2026) created a spike in sales the month before the new tax took effect. However, this is one more reason given when property owners decide to delay selling their home; just one more burden that will be due upon sale. Remember that the conveyance tax affects every seller. Given the legislators’ propensity to look at homeowners as the deep pocket to solve the budget woes, the market constraints are real.
On the bright side, as baby boomers age, the market inventory will inevitably increase and hopefully help the starter market. Until then, new participants to the market will have a hard time calling Rhode Island home.
Marc Larocque is a PBN contributing writer. Contact him at Larocque@PBN.com. You may also follow him on X at @Marc_La_Rock.
