RI Home Sales Sluggish In Second Quarter

According to the Rhode Island Association of Realtors, the median price of a single family home dropped two percent in the second quarter of 2011, when compared to the same period last year. Sales were down more than 20% year-over-year.

In Woonsocket, there was some good news.

Despite a 48% decrease in sales and an 85% increase in days on the market, the median price of a single family home rose nearly 7% from $136,500 to $146,000.

Multi family homes also fared well. Despite a 22% increase in days on the market, sales increased 10%, with the median home price rising more than 6% from $91,000 to $96,500.

Unfortunately, the news for the condominium market wasn't as good. Despite a 64% decrease in days on the market, sales dropped 18%, and the median price dropped 12% from $97,000 to $85,000.

The current state median price is $205,000, compared to $210,000 in the same quarter last year.

Statwide, the median price of condominiums saw a 3.7% drop to $173,000 from $179,625 in 2011. The condominium market also saw a reduction is sales, falling 14.4 percent from 2010.
The multi-family market across Rhode Island also saw a sizeable reduction in sales, falling nearly 30% in the past year. On the bright side, the median price of a multi-family home held steady at $120,000.

In a press release, the Association pointed out that the news isn't that bad when the current quarter is compared to 2009. The problem is that sales figures from 2010 are skewed because of a federal tax credit used to boost the housing market.

Stephen Antoni, President of the Rhode Island Association of Realtors, explained the effect of the tax credits on house prices.

“There’s no question that sales have fallen since the tax credit expired a year ago but we’re beginning to see them slowly creep back up again. June closed out the quarter with the highest number of monthly sales in 12 months,” Antoni said in a statement.

Another reason for the depressed market is the difficulty some borrowers have getting a mortgage, which can have a ripple effect at all price levels, Antoni added.

“Still, extremely tight lending standards remain a problem for the housing market. It’s a chain reaction," Antoni explained. "If first time home buyers can’t qualify for a home, sales of lower priced homes are delayed. And, if those homeowners can’t sell their home, they can’t move up to another price bracket."