This May Be the Reason RI’s Housing Market Remains Strong

This May Be the Reason RI’s Housing Market Remains Strong

Despite higher interest rates, crushing inflation, and the threat of a recession, Rhode Island’s housing prices have continued to remain at a record level and continue to show dramatic year-over-year growth.

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The secret may be the diversity of the property in the state. Rhode Island has little tract housing -- those rows and rows of repetitive homes that if the price dips on one, it has a domino effect on the others.

Instead, Rhode Island's most recent housing stock has included a historic lighthouse, a property built in the 1600s, and a collection of horse farms of 50 acres or larger. Those were just the homes that came on the market over the past week. Don't forget Rhode Island's most expensive property now on the market -- Sandcastle in Watch Hill with an asking price of $32.5 million and an amazing history.

Kim Marion, a top agent for Mott & Chace Sotheby’s International, joined GoLocal LIVE on Wednesday and discussed the variety of offerings may be one of the secrets to the success of the state's real estate market.

“It's a really interesting property, and super rare that you could buy a lighthouse and have your single-family home attached to that, and it is really right under the Mount Hope Bridge," said Marion of the lighthouse. "So it's an interesting view that you never see -- the architecture of the bridge is really interesting and then, of course, incredible water access."

“It's so unique and the opportunity to own a piece of history like that -- it's fascinating,” added Marion. 

Rhode Island continues to attract out-of-state buyers. More than 50% of the luxury homes are bought by transplants led by Massachusetts, New York and Connecticut buyers but are now including west coast residents. 

 

Stone Ender Home

One of Rhode Island's oldest homes has been restored, and it is now a blend of history and new amenities. The "Crown Jewel" of stone enders is now for sale. This stunning historic home, known as the "Valentine Whitman House," was originally built in 1696 and has just been carefully and thoughtfully restored by Preserve Rhode Island and Heritage Restoration.

“I think it's really interesting that it's so contemporary inside, and I'm curious; I'm gonna ask people as I see them, you know what do you think about it," said Marion.

She said there are only 14 stone ender homes in the state.

But, the lighthouse and the stone ender home are just two of the diverse offerings. There are three equestrian farms of more than 50 acres.

 

Numbers and Trends

According to the July numbers, the median price of a single-family home is $410,000.

In 2015, the median price of a Rhode Island single-family home was just $202,500 — more than a 100% increase in just seven years.

Mark Zandi of Moody’s predicts U.S. house prices will shift somewhere between 0% to -5%.

That baseline forecast assumes the U.S. won’t enter into a recession. If a recession hits, Moody’s Analytics now predicts U.S. house prices will fall between -5% to -10%. That’s up from June, when Zandi told Fortune that a recession would see U.S. house prices fall by less than -5%.

Meanwhile, Fitch Ratings says there’s a scenario where U.S. home prices fall by -10% to -15%.

Right now in Rhode Island, the market is steady - and may be the only place that a 1600 stone ender home, a lighthouse, and a 50 acres horse farm are all for sale -- just minutes from one another.