The median price of single family home sales rose sharply last month, increasing 17 percent from the prior year, to $210,000 according to reports from the Rhode Island Association of Realtors.
Though sales activity was down five percent from April, 2013, the number of single family homes on the market rose two percent, the first year-over year increase in single family home inventory since March of 2012.
“We’re excited to see more homes coming onto the market. There’s been too little to choose from for too long. With interest rates remaining low, prices on the rise, and buyers’ options expanding, we should be seeing good opportunities ahead for both buyers and sellers,” said Robert Martin, President of the Rhode Island Association of Realtors.
The condominium market also saw strong gains with median price rising ten percent to $172,500 and sales activity increasing by three percent. Among multi-family properties, median price rose thirty percent to $139,400, accompanied by a decrease in sales activity of 19 percent. Tougher lending requirements and spent demand on the part of investors who snatched up properties at their lowest, have tempered sales in the multi-family market.
According to Lawrence Yun, Chief Economist for the National Association of Realtors, the upside of rising prices is a recovery in home equity. “Based on our forecast for this year, the median home equity gain over three years is expected to be $40,000,” Yun said at a recent presentation to residential Realtors at the Realtor Party Convention and Expo last week. Yun expects a continued uptrend in the market through 2015 with 30-year mortgage rates reaching 4.7 percent this year and 5.5 percent next year.
“The recent drop in Rhode Island’s unemployment is a good sign for the future of the state’s housing market,” added Martin. “Obviously, home affordability will decrease as interest rates rise so the more people who are employed and back on solid financial ground, the more entrenched our recovery will be.”