RI Housing Sectors Show Strong Activity and Price Gains in September

WARWICK, RI – September home sales were strong in Rhode Island according to statistics released today by the Rhode Island Association of Realtors. Existing single family home sales increased 16 percent from September, 2012 and median price rose 13 percent to $209,900.  The number of foreclosure and short sales fell 11 percent, the 10th consecutive month of decline.  The median price of conventional sales only was $234,900.

“It’s undeniable that the housing recovery is well underway but sales activity will likely begin to moderate in the months ahead. In September, we saw an eight percent drop in sales contracts expected to close in the following months,” explained Victoria Doran, President of the Rhode Island Association of Realtors. Doran explained that rising interest rates likely led to the recent lull in pending contract activity.

“We’ve been spoiled. We still have interest rates in the fours which is much less than the historical norm but people forget.  Now we look at six percent as high, which is unbelievable,” she commented. Interest rates have once again started to drop in recent weeks she noted.

September sales in the condominium market rose 33 percent while median price rose ten percent to $206,000. An increase in pending sales of two percent indicates that condo sales will continue to remain stable in the coming months. Condo sales have been rising since August, 2012.

Activity in the multi-family market also followed suit with an increase of 26 percent from a year ago. Median price rose seven percent to 139,500.

At a recent presentation to the Rhode Island Association of Realtors, Lawrence Yun, Chief Economist of the National Association of Realtors, noted that high demand and under supply is leading to rising prices.  Yun pointed to a precipitous drop in new housing starts in Rhode Island since 2006 and the need for new construction to balance future supply and demand.

The Rhode Island Association of Realtors will be releasing third quarter sales statistics on November 5, 2013.

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