Available homes reaches century mark
Several of the island’s top realtors said last week real estate sales are running slightly behind last year’s levels, with 25 closings (between Jan. 1 and June 30) compared to 27 in the same period a year ago.
From low to high, 2011 prices ranged from $240,000 to $1,750,000, according to the Multiple Listing Service for real estate professionals. The 2011 median sale price is $389,500.
By contrast, in the first two quarters last year, prices ranged from $257,000 to $5,700,000. The MLS put the median sales price at $480,000.
Island Realty’s Virginia Prichett, Lila Delman’s Bob Bailey, Stearns Farms’ Mark Ferranti and Mansions and Manors’ Gloria Kurz assessed the status of Jamestown real estate, starting with the maze of 100 “for sale” signs and explaining what the big number says about the future.
No question, a lot of Jamestown’s housing inventory is sitting on the market today, with 94 houses available priced between $229,900 and $9,450,000, according to the MLS.
Kurz put the true number for sale at 100, counting houses under contract but not guaranteed to close due to stipulations.
As a reference point, in a hot market, only about 35 houses would be available, according to Island Realty’s Carol Hopkins.
“This is a new milestone for us,” Kurz said, “and is the highest inventory level in the 16 years I have been selling real estate in Jamestown. Over those years, I have seen levels creep up and a number of barriers broken. There was a time when people thought that 50 homes on the market was a large number. Then it became 75. It is a natural progression and just a matter of time before we reached the 100 mark.”
Bailey said the number represents a 5 to 10 percent increase from 2010.
In that mix, 34 luxury waterfront houses have come on the market. Fourteen, Kurz said, are listed for over $2 million. Asking prices for 20 fall between $1 million and $2 million. So far this year, only two high-end properties have closed. Kurz sold one for $1.75 million and a second one this week for $1 million.
“They’re not moving,” Ferranti said.
But, all is not lost, according to the realtor. “There are signs of life,” said Kurz about the luxury market, which “really took a hit” over the past 12 to 18 months. Meanwhile, she said, “We are seeing a lot of lower-priced sales. Sales under $500,000 are driving the market, she said. Eighteen houses this year sold for less than $500,000 compared to 15 last year.”
Although prices have sagged so far in 2011, buying a Jamestown home remains “a pretty darn good investment,” according to Prichett. She expects a “vibrant” summer, despite 2011’s slow start.
“A good harbinger,” Prichett said, is the number of sales, 11, in the pipeline. The MLS put those prices between $289,000 and $689,000.
In fact, all of the realtors expect sales over the coming five months to catch up to last year’s pace when 73 single-family homes sold for prices between $215,000 and $7,800,000, and the median was $447,500.
“The key thing is,” Bailey said, “2010 had roughly 72 single-family homes sell. Above 72, it’s more than a year’s supply.”
He suggested the 90-plus houses for sale represent 15 months of inventory but added that the cold spring weather has been a depressing factor.
“Our second home buyers haven’t come out to do their shopping yet,” he said. Bailey added that the rainy, cold weather has kept them away.
The 2011 numbers are not that far below 2010 levels, Ferranti said.
“It’s a slight decline,” he said, adding that he believes the Jamestown market is on “an upswing” but hampered by the slow recovery nationwide.
“It’s just a tough economy,” he said. He added that people with minor credit problems are being shut out of the market. “The problem is the banks. They’re a lot tougher than they used to be.”
He estimated values fell 10 percent in the last 18 months. Bailey put the decline around 25 percent.
Asked if buyers risked another price slide, Ferranti doubted so. He remains positive on buying Jamestown real estate.
“I don’t think you can lose right now,” he said. “We don’t have a crystal ball, [but] our taxes are still pretty reasonable and it’s very comfortable here.” He compared Jamestown to Rhode Island’s other special situation, Providence’s attractive East Side. “I just think Jamestown’s unique from the rest of the state.”
The realtors also said it’s a good time to buy a house here, despite challenging times for both the United States and Rhode Island economies and housing markets.
Hopkins found specific reasons for optimism at Forecastchart.com, a site used to predict Rhode Island real estate, which said that the state will outperform the rest of the nation. According to its outlook, prices will climb five percent, while sales decline by about the same five percent.
Bailey sees current price levels as close to rock bottom, depending on the buyer’s down payment. “At the current price point, it would be a good time to buy. Sellers are motivated and under pressure, and it’s still characterized as more of a buyer’s market.”
He also thinks that the number of renters will drop as people consider the advantage of buying when mortgage rates are low and also taking tax deductions. A tax accountant can answer the question, he said, whether the tax shelter is better than putting money in a money market or a certificate of deposit.
Of course, he said, it’s hard to get into the market exactly at the bottom. “You never catch a falling knife, but you can decide where you might want to grab it,” Baily said.
He added that this year, houses sat on the market for a median 128 days compared to 78 days in 2010.
For obvious reasons, Jamestown homes remain some of the most sought after in the state. There are also some unique reasons that families choose the island. For example, conservation land: Does the emphasis on protecting land have an impact? Pritchett said the preservation of land adds to the town’s appeal. “Conservation land is one of the reasons people want to be here,” Prichett said. She added that people want to know where their food comes from, and they like buying eggs and produce from the farms.
Also, Prichett said there is sense of safety on the island. “There is no neighborhood in this town that has a high crime rate,” she said. “Take a look at the police blotter. Nothing happens here.”
Baily said that Jamestown has a certain charm to it. “We are an island,” Bailey said. “We are connected by way of two bridges, but we have an island paradise feel. Many Rhode Islanders aspire to island life with modern-day conveniences.”
According to Ferranti, some buyers started off as just passersby. Most arrivals are Newportbound, but they don’t necessarily continue on to Newport. The locals may take Jamestown sights for granted, but visitors think they’ve discovered Utopia, he said.
“They come over the bridge and fall in love with Jamestown. They see the water, the bridges and all the boats and think they’ve died and gone to heaven.”