Median Price of a Single-Family Home in RI Drops to $390K, Interest Rates to Decline
Tuesday, January 17, 2023
For months, the median price of a single-family home in Rhode Island has hovered around $400,000 or more.
In November, the median price was $411,000 — a 100% increase over 2015 price levels in Rhode Island.
Now, at least for one month, there was a slight reversal.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLAST“One of the most interesting numbers is that our medium sold price has dropped below $400,000 from December last year to December this year to $390,000,” said Ben Scungio of Mott & Chace Sotheby’s International.
Where is the Inventory?
In addition, he said inventory, or the lack of it, is a major market factor.
“And as I mentioned last week, we still don't have enough inventory - just 1.3 months worth of inventory compared to last year’s 2.3 months year — so there was actually more to choose from last year than this year,” said Scungio.
“inventory year over year is down almost 27%, pending sales down 15%, and the number of close units down 42% year over year,” added Scungio.
Mortgage Rates
Mortgage rates saw historically high gains in 2022, but with inflation likely to cool and a potential recession on the horizon, real estate economists predict that rates will fall in 2023 — potentially below 6%.
Last week there was positive news on inflation.
“Overall consumer prices fell a seasonally adjusted 0.1% in December from November—the first monthly decrease since May 2020, the Labor Department said. But the annual inflation rate remained high. The consumer-price index rose 6.5% from December 2021,” reported the Wall Street Journal.
“Americans’ feelings about the economy improved in early January, reaching its highest level in nine months, the University of Michigan’s consumer sentiment survey said Friday. Consumers’ expectations for inflation in the next year receded for the fourth straight month to the lowest reading since April 2021,” according to WSJ.
Both the National Association of Realtors and the Mortgage Bankers Association predict that the 30-year fixed mortgage rate will average 5.7% this year, according to U.S. News & World Report.
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