Home sales drop 14% in 2006 as prices rise

The number of single-family home sales in Rhode Island fell by 14.4 percent in 2006, from 9,711 to 8,313, and the median sale price dropped $7,500 to $282,500, the Rhode Island Association of Realtors reported last week.
The median price drop was the first in the state since the early 1990s.
But the overall gross dollar value of sales only dropped by $450,000 because sales of high-value homes pushed the average sale price to $355,152, the group said, up 1.25 percent from in 2005. Total sales dropped from an all-time high of $3.4 million in 2005 to $2.95 million last year, a sign the association’s president viewed as an indication of a “moderating” market.
The number of days homes sat on the market also rose, from 67 to 79.
While the numbers marked a downturn from the record highs the state had experienced in recent years, association President Cecile Cohen said that year-end stats showed a “moderating market.”
“As we predicted, we didn’t see a crash in the real estate market last year — the economic factors just weren’t there for that to happen,”
said.
The association also reported drops in the sales of multi-family properties and condominiums. Sales dropped 25.23 percent for multi-family properties and 16.35 percent for condos.
The Rhode Island Builders Association also released its figures for
2006 last week, reporting a 9-percent drop from 2005. In total, 1,606 single-family home building permits were issued last year, down from
1,765 in 2005.
“Much of the overall annual decline was expected, considering the national housing market correction,” said Executive Director Roger Warren.
The builders association did see an increase in the fourth quarter of
2006 from 2005’s figures, with 448 permits issued at the end of last year. The amount represented an increase of 37.
However, the association attributed the spike to unseasonably warm weather at the close of 2006.
While overall permits issued were down, communities experiencing a jump in their figures included: Pawtucket (215 percent), Lincoln (157 percent), Westerly (127 percent) and Providence (88 percent).