Rhode Island’s housing market continued to improve in the first quarter, with single family home sales rising two percent and median price rising by five percent to $195,000. The statistics, released today by the Rhode Island Association of Realtors, showed a ten percent drop from the first quarter of 2013 in the number of single family foreclosure and short sales.
The condominium market showed five less sales from January through March compared to the same time period the prior year - a decrease of two percent. Median price rose six percent however, to $194,900.
Multi-family sales decreased three percent but median price went up substantially, rising 26 percent, to $139,000. The median price was boosted by a 21 percent decline in the number of foreclosure and short sales. The median price is the halfway point of sales, with half selling for more and half selling for less. It does not represent appreciation or depreciation of an individual home over time.
Weather conditions a factor
“Weather conditions played a factor in home sales during the first quarter. When you consider the mild winter we had in 2013 compared to the cold and snow we saw this year though, we’re lucky we didn’t see a significant downturn in sales. Overall, I think the market remained remarkably solid in the first quarter,” said Robert Martin, President of the Rhode Island Association of Realtors.
Fears of rising flood insurance rates due to the Biggert Waters Reform Act also slowed sales during the first quarter but the draconian rise in rates was reversed by the Flood Insurance Relief bill signed into law by the President in March. The Realtors Association commended Congress and the President for moderating the rate increases for most homeowners, and stopping the home devaluing effect of the original Biggert Waters bill. The Flood Insurance Relief bill and the Biggert Waters Reform Act that preceded it were designed to ensure solvency of the National Flood Insurance Program which provides flood insurance to thousands of homeowners.
Supply of homes increased
Though the quelling effects of harsh winter weather and fears about prohibitive flood insurance rates are now in the past, Realtors caution that low inventory and tough mortgage underwriting standards may have a continued dampening effect on home sales in the months ahead. The supply of properties for sale has increased monthly since December as buyers put their homes on the market in time for the spring selling season, but remains below last year’s level.
“The good news is that prices are up and people have regained equity. But it would be good to see more listings which would result in more sales. We’re hopeful that that will happen this spring,” Martin commented.