Rhode Island’s economic struggles are well documented, but there is one area of growth which many people should find encouraging. Although the Ocean State is still coping with double-digit unemployment, we at RE/MAX of New England are happy to report a very active and lively housing market.
According to the latest RE/MAX of New England July Monthly Housing Report, the total number of homes sold in Rhode Island in July 2012 was up 32.4% when compared to July 2011. That is the highest year-over-year jump in all of New England.
Home values in Rhode Island are still in the process of stabilizing, though. The Ocean State was the only state in New England to see a year-over-year decline in this area, with the median price dropping about 11%. While some may see this news as negative, this represents an exciting opportunity for first-time buyers and investors.
In order to better take the pulse of the State, we decided to look at a snapshot of real estate action in the Patch communities of Cranston, Middletown and Woonsocket.
Among these areas, Cranston experienced the most exciting gains. Year-over-year, the number of homes sold more than doubled. While 38 homes were sold in July 2011, 81 homes changed hands last month. For the first seven months of 2012, there have been 424 sales, up from just 196 during the same time period last year. That’s an astounding 116% spike!
Woonsocket’s year-over-year transactions also grew, from 15 in July 2011 to 21 in July 2012. For the first seven months of the year, home sales are also up nearly 17%, from 89 last year to 104 this year.
Total transactions in Middletown remain relatively flat year-over-year. There were 13 homes sold in July 2012, compared to 15 in July 2011. The same number of houses, 71, was sold during the first seven months of both years.
Home owners in Middletown should not be alarmed by the lack of growth, though. Part of that can be attributed to the fact that home sales in Middletown were not affected as sharply as in Cranston and Woonsocket. Both of these cities took quite a hit but are now benefiting greatly from an influx of first-time home buyers and investment buyers.
One reason first-time buyers and investors are able to be so active right now is a combination of high inventory, affordably priced homes and historically-low mortgage rates.
In others parts of New England, potential buyers anxiously sat on the sidelines waiting for the market to reach “the bottom.” Although many jumped in, some continued to hope prices would go even lower. With prices now on the rise, they missed their opportunity.
This opportunity still exists in Rhode Island. Many consumers have taken notice, deciding to pull the trigger on a purchase this summer. Still, others are waiting. But, I expect them to get in on the action this fall as they realize there has truly never been a better time to scoop up their own little patch of real estate.
Dan Breault is the Executive Vice President and Regional Director at RE/MAX of New England. His blog, Patch of Real Estate, is a monthly feature which provides a closer look at real estate sales in various Patch communities and the housing trends that affect Rhode Island.