High demand, low inventory still driving up cost of single-family homes in RI

Business News

EAST PROVIDENCE, R.I. (WPRI) — While it’s difficult to predict what the housing market will look like in 2022, those in the business hope it will be a robust spring.

New data from the Rhode Island Association of Realtors shows that even though sales of family homes fell by more than 8% last month compared to November 2020, the median sale price increased by 16%, or roughly $375,000.

“There’s been a dearth of inventory,” said the association’s new president, Agueda Del Borgo. “In terms of closing, sometimes the escrow period can take a little bit longer, but the pendings have increased in the past month.”

According to Del Borgo, high demand and low inventory is driving up the median sale price for single-family homes in Rhode Island.

“Rising rent prices, low interest rates continue to be a factor, and we also have folks moving in from out of state,” she added.

The association’s data shows nearly a quarter of all property sales through a realtor involved buyers from other states. The association said a shortage of single-family homes led buyers to shop in other areas of the market.

The data also shows that closings on multi-family homes increased by 4.7% from last November, and condominium sales were up 11.7%.

Del Borgo said she’s optimistic the spring housing market will be strong in Rhode Island.

“I believe that there will be naturally more inventory because seasonally that’s the case,” she said. “Generally, it’s always more robust in the spring than in the middle of the winter.”

Realtor.com’s forecast for the 2022 housing market notes that strong competition and affordability will continue to be a challenge for buyers, however.

“The workforce and affordable housing, it definitely is an issue and right now,” Del Borgo added. “We’re working with policymakers to bring more affordable housing into the state. That’s an ongoing pursuit.”

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