Warwick, RI – June 22, 2010…May sales statistics released today by the Rhode Island Association of Realtors showed sales and median price of existing single family homes and condominiums up year over year. Single family home sales were up marginally from 666 home sales in May 2009 to 667 last month. Median price rose five percent from $190,000 May 2009 to $199,900. Condo sales surged 22 percent and median price rose 14 percent to $181,925. The median price of single family homes and condominiums sold through conventional means, not foreclosure or short sale, was $228,500 and $208,500 respectively.
Despite the expiration of the $8000 tax credit for first time buyers and $6500 tax credit for move up buyers which expired in April, sales did not decrease dramatically from April to May as many predicted. Sales increased by one sale in the condominium market and decreased by one sale among single family homes.
“Sales and prices held their own in May even though the tax credit expired in April. Buyers seem to realize that what they’re seeing now are real values. I remember interest rates in the teens… you can buy a lot more for your money with today’s rates,” commented Karl Martone, President of the Rhode Island Association of Realtors. Martone also credited May’s strong sales to realistic pricing.
One of the first states to enter the housing boom, Rhode Island’s housing recovery is ahead of the national curve. The short sale and foreclosure rate continues to decline, down to 28 percent among single family homes compared to 34 percent last year, and down to 15 percent in May 2010 from 31 percent the year prior in the condo market. A recent report by Realty Trac concurred with the Realtors’ statistical trend, citing that Rhode Island’s foreclosure rate declined 28 percent in May from the year prior while the national average rose .5 percent.
Decreasing distressed sales appear to be causing pending sales to decline as well. Though increased pending sales typically indicate an increase in sales to come, in a distressed market, pending sales often increase as short sales and foreclosures tend to take longer to close, thereby remaining “pending” for longer periods of time. “I think that the fall in pending sales likely has a lot to do with getting stagnant transactions closed,” said Martone. “If people read articles about foreclosures increasing in the Providence market, they’re likely reading statistics reflecting the Providence, New Bedford and Fall River markets, not Rhode Island alone. Rhode Island’s distressed sales have fallen dramatically while they’re soaring in nearby Massachusetts.” Economists often refer to Metropolitan Statistical Markets when citing statistics which in Rhode Island’s case includes Fall River and New Bedford.
The multi-family market saw a 32 percent increase in price to $107,900 from $82,000 in May 2009. Distressed sales have declined, accounting for 63 percent of all multi-family transactions in May of this year, down from 79 percent last year. Sales decreased by 18 percent to 143 units sold last month as the frenzy fed by rock bottom prices has abated. Sales were up from the April however, when 140 multi-family properties sold. The median non-distressed price of a multi-family property in May was $160,000, 48 percent higher than the median which included distressed and non-distressed sales.
Variations in sales data collection methods may provide discrepancy is data interpretation. Rhode Island Association of Realtor statistics include all Realtor-assisted property transactions in Rhode Island only, the vast majority of which are generally recorded with the State-Wide Multiple Listing Services within two days of closing. Realtor transactions account for approximately 96 percent of all sales and exclude non-arms length sales such as discounted sales between family members.