FOR SALE: Another house on the market as sales increase.
Sales of existing single-family homes in Rhode Island increased during October, according to the Rhode Island Association of REALTORS. Projected annual single-family home sales, which remain 15 percent ahead of 1998’s record year-end pace of 8,937, are expected to arrive at the 10,000 sales plateau for the first time ever, at year’s end. During the month of October, existing single-family home sales increased by 6.8 percent last year to this year. A total 822 of pre-owned single family homes were sold last month compared to October of 1998 when 770 similar properties were sold. The increase was the least of any month in 1999 in comparison to last year with the exception of April, which experienced a gain of less than 1 percent.
The median sales price for an existing single-family home increased from $122,500 in October 1998 to $125,000 this year and is up from the September 1999 median sales price level of $122,000.
Beyond Cash Donations: How New Forms of Giving Are Transforming Not-for-Profit Accounting
Evolving Funding Landscape for Not-for-Profits Not-for-profit organizations are being asked to do more with less,…
Learn More
“There are a lot of ingredients working on the real estate industry,” said Ronald Phipps, president of the RIAR. “Rising mortgage rates tempered the state’s strong overall housing market but record low unemployment, strong consumer confidence, as well as home buyers’ beliefs that interest rates will remain stable after fluctuating in recent months is shoring up the demand.”
The soaring sales numbers will not last forever.
A decline in inventory continues to play a role in the Rhode Island housing market. There were 250 fewer homes (3,150) for sale at the end of October compared with 3,400 existing single-family homes for sale through State-Wide Multiple Listing Service (MLS) a month earlier. The total single-family inventory has decreased by 26 percent since January 1999, and has fallen by about 34 percent since the end of October 1998.
“We know that 1999 is going to be a record year for home sales but in all likelihood we anticipate the pace to ease slightly next year,” said Phipps.
The latest numbers for multi-family homes are equally impressive, according to RIAR.
Re-sales of multi-family homes in Rhode Island topped record levels in the first three quarters of 1999. Unlike single-family homes and condominiums that are in moderate to short supply respectively, multi-family home supplies are reduced, but remain plentiful. The third quarter median sales price increased for the second straight year to the highest level since 1993.
During the first nine months of this year, re-sales of two, three, and four-family homes transacted through MLS reached 1,179 in the state. This represents a 21 percent sales increase from last year’s third quarter level of 977.
The total dollar volume for multi-family homes sold in Rhode Island increased an even greater amount, up 27.6 percent to $122 million from $95.6 million through the third quarter of 1998. The median selling price of a multi-family home during the first nine months of 1999 was $96,000, an increase of 4.4 percent from the 1998 third-quarter level of $92,000. This was the second such median sales price increase in as many years. The third quarter median sales price of a multi-family home in Rhode Island hit an 11-year-low in 1997 at $82,800 and peaked statewide in 1990 at $128,300.
“It appears the recovery, which began last year in the multi-family home market, is continuing,” Phipps said. “A multi-family home purchase remains one of the best real estate buys in Rhode Island.”
The robust economy and rising level of consumer confidence, Phipps said, is fueling the multi-family home sales and creating opportunities for people who may not have thought they could afford to buy a home.
“Some families who rent may not feel they can afford to own a home, but in reality, the initial and monthly costs of renting can be almost as high as the cost of owning a home,” he said.
Phipps said that people often overlook the fact that lenders take into consideration the rental stream produced by multi-family homes when determining how much a prospective homeowner can afford.
Currently, a median priced multi-family home is 23 percent lower than its single-family home counterpart — $96,000 compared with $125,000. There is now an eight-month supply – about 1,050 multi-family homes for sale through MLS at this year’s sales pace. This compares with nearly 1,300 similar properties for sale in mid-November last year.
