Warwick, RI, April 27, 2017…March sales of single-family homes showed minimal change from the prior year according to the Rhode Island Association of Realtors. Realtor-transacted sales remained relatively stable, falling just 1.2 percent from March of 2015 and the median price of those sales rose 2.2 percent to $235,000.
However, sales in progress were 25.7 percent lower last month than the prior year, an indication of restrained sales in the months ahead. Such pending sales began to fall at the end of last year, resulting in fewer closings in March and February of this year than seen 12 months earlier. Prior to this slowdown, pending sales had increased for 26 months consecutive months.
Lack of inventory is a primary factor in the restriction of sales in progress. There were 3281 single-family homes for sale in Rhode Island last month, compared to 4044 in March of 2015. Currently Rhode Island has a 3.6-month supply of homes for sale. A six-month supply is considered a market that favors buyers and sellers equally.
“The last time we saw supply this low heading into the spring selling season was 2005. That said, we aren’t facing the same situation as we had then. This time around our market trends aren’t due to the speculation and lax lending that led to so many foreclosures and short sales. People are in a better financial position now so eventually the market will follow its natural course and supply and demand will regain equilibrium,” commented Brenda Marchwicki, President of the Rhode Island Association of Realtors.
The condominium market was the standout sector of the market in terms of sales activity last month, rising 36.8 percent from the prior year. The median price of condos sold in March fell 3.2 percent to $195,000.
The multifamily home market saw similar trends with a 20.5 percent gain in sales and a median sales price of $175,000, unchanged from March, 2015.
“Condominiums and multifamily properties are often an alternative to the smaller, lower-priced, single-family homes sought out by first-time homebuyers. With the supply of such stand-alone homes dwindling, it appears buyers are turning to other sectors of the market to fulfill their dream of home ownership,” commented Marchwicki.