Real Estate News

Wow! Politicians announced the federal tax credit home buyers as the beginning of the end of the recession. For those who want to believe that the end was in sight, there was a moment or two, when it seemed that the incentive was to change things. Of course, when the tax break ended, the real estate sales stopped dead.

Average prices at home in Rhode Island continue to fall and is likely to fund about $ 200,000 next year. At the peak of the boom times in 2006, the average price of a house in Rhode Island came to $ 300,000. The math speaks for itself. If you bought a house during the boom, which has lost 33 percent of its value.

Banks are starting to clear their inventory of foreclosed properties and more and more people are coming to market each month. Buyers no longer attracted by the $ 8,000 tax credit, are simply not buying. Prices have nowhere to go but even lower in coming months. Even with mortgage rates at historic lows, buyers are concerned about the future.

Statistics on the number of pending home sales, which measures contracts signed, has fallen for the fourth consecutive month. From May to June, the decline is around 30 percent. With about 12 percent unemployment in the state of these figures do not bode well for real estate in Rhode Island.

The truth of the matter is simple. From the peak in 2006, the average price fell from nearly $ 300,000 to $ 180,000 in March 2009. When the tax incentives became law, another real estate boom occurred and the median rose to $ 291,000.

Real estate has a huge multiplier effect throughout the economy. Consumer confidence and home sales to boost the economy as a whole. Bankers and brokers of retail sales of carpets, furniture and other household items, slow sales at home amounts to a generally slow economy.

The old adage, “is not over till it’s over,” definitely applies in Rhode Island.