The right time to buy depends on the individual
With property values in Rhode Island on the rise, many families may falsely believe it is not the right time to buy a home. But a historical look at Rhode Island’s real estate market indicates the housing market is simply returning to its true value and it is here to stay. As you determine whether buying a home is the right call, J.Christopher Real Estate Group would like to remind future homeowners what real estate professionals already know: the right time to buy a home is when you are ready.
The median price of a home in Rhode Island is hovering close to $260,000, RI Association of Realtors stated. Most of the increases have been attributed to a shortage of available homes, which fell from 3,569 to 3,190 from a year ago. Other large factors that are out of buyers’ control is economic growth.
“It is rare for individuals to capitalize on real estate if they are only relying on current market conditions,” said Jarrod C. Lewis, owner of J.Christopher Real Estate Group. “The real estate market goes through ups and downs, but generally home prices tend to increase as the economy improves.”
From a historical perspective
Before the banking crisis of 2008, median home prices in the Ocean State reached $282,900. Shortly afterward, prices reached a low of $190,000 in 2012, according to the Providence Journal. Some people may be concerned the same thing will happen again, but that scenario is unlikely to happen a second time because banks have drastically changed their lending practices. Specifically, subprime loans comprised 5 percent of the total market in 2015 compared to 20 percent when the housing bubble burst.
Another reason why home prices are likely to remain the same is because data from the Census of Housing shows Rhode Island home prices have traditionally increased. In 1940, home prices in Rhode Island were $40,000. Prices reached more than $60,000 in 1960. And in 1990, prices reached $170,000.
“As people earned more money and the population grew, home prices increased and that is what is happening now,” Lewis said. Furthermore, financial experts anticipate the U.S. economy to remain healthy in the coming years. Rhode Island in particular saw its economy perform better than a dozen other Northeast states, according to the Bureau of Economic Analysis.
Key indicators show that the median price of homes in Rhode Island are likely to remain the same or could increase further. For these reasons, families should go into real estate negotiations with the understanding that they are buying a home for an amount closer to its true value.
Home buyers have several options for financing a home that were not available many years ago. Whether you are looking for a single-family unit to create lasting memories or a multi-family house to build your real estate portfolio, J.Christopher Real Estate Group can help you reach your goals. Speak with one of our agents at 401-830-6906 today to begin the home buying process.