Home Prices 'Skyrocket' As Inventory Dwindles: RI Realtors

PROVIDENCE, RI — Home prices in Rhode Island continue to rise, with no relief in sight. The median sales price for April was another all-time high, the state's Association of Realtors said in its latest monthly report.

In April, the median price for a single-family home was $349,900, which is 18.1 percent higher than the same time last year.

Demand for new homes continues to far outpace supply, the association said. Amid "extremely low inventory" or available houses, closing activity was up 15.9 percent in the last month, according to the statement.

Under the current conditions, the number of homes on the market would completely run out in just over a month, the association said, far lower than the five to six months usually seen in a balanced market.

Leann D’Ettore, the president of the Rhode Island Association of Realtors, said that "it's hard to believe the appreciation that we’ve seen in the housing market in the past few years."

"In April 2015, our median sales price didn’t even hit $200,000. Now just six years later, we’re seeing more than a 75 percent gain," she said. "That’s great news for homeowners but for those trying to buy their first home, the scarcity of homes for sale and accompanying rising prices, are making for a difficult home search."

Multifamily home sales continue to climb, as well, rising to a median price of $355,000 in April. That's 24.6 higher than the same time last year. Except for last June, when closings were seriously impacted by pandemic shutdowns, multifamily home sales have risen by double digits year-over-year every month for the past 15 months, the association said.

"Multifamily homes are popular because they provide a means to homeownership which provides income through rentals for those needing the extra infusion of monthly cash," D'Ettore said. "But those properties are also attractive to cash investor buyers looking to capitalize on rising rents and escalating real estate values. With incentives for multifamily homes at both ends of the spectrum, it’s not surprising to see prices rising so rapidly."