Inventory Scarce as Interest Rates Rise The first three months of 2022 saw a seismic shift in our focus. Omnicron took a back seat to the crisis playing out on the world stage as Russia invaded Ukraine in late February and unleashed a humanitarian crisis unparalleled in most of our lives. The extraordinary evacuation of millions of people fleeing their homes continues to play out amid stories of death and devastation. Neighboring countries opened their borders, with an outpouring of heart-felt support, and even Jamestown will now be home to a Ukrainian family, thanks to the Brine family who spearheaded relocation efforts for the family. The global economic fallout from these tumultuous events, in combination with efforts by the Federal Reserve to check inflation, are partially responsible for Tuesday’s rise in the rate for fixed mortgages, which this time last year were at 3.38%. On Tuesday, for the first time since 2011 (with the exception of 2 days in 2018), fixed rate mortgages increased to 5.02%. Increases in mortgage rates will affect some Buyers and potentially market conditions (on a $400,000 mortgage, there is almost a $400 difference in payments between the two interest rates so it impacts consumer buying power and/or spending). Jamestown has yet to experience any obvious impact from the change in the mortgage environment, which started in January. The number of homes sold at the end of the first quarter increased by 11% vs. the same period last year, although the average sales price declined 15% and the median price decreased by 16%. The average days on market was down to 78 days, an 11% decrease over last year. We continue to see multiple offer situations, although three of the five most expensive homes currently for sale have been on the MLS for over 6 months and two of these have been actively for sale for almost 9 months.
Summary of Single Family Home Sales Jamestown, Rhode Island 1st Quarter 2022 vs. 1st Quarter 2021 Total # Sales Total Sales $ Average Sale Price Median Sale Price Average DOM
2022 20 $22,422,400 $1,121,120 $840,000 78
2021 18 $28,788,404 $1,321,578 $1,000,000 88
% +/11.11% -5.74% -15.17% -16.00% -11.36%
There are four homes in pending status, listed between $799,000 and $5,500,000 (Mansions & Manors represents the Buyer for the $5,500,000 home). Statewide, there are just under 600 homes actively on the market. This represents an increase from the beginning of the year, when there were under 550 homes for sale. There are 1200 homes waiting to close (vs 1543 last year) and 271 under contract (vs. 401 last year).
Source: Statewide MLS
The least expensive sale in the first quarter was in the Shores. A home on Umiak closed at $515,000, 16% ($70,000) above its asking price of $445,000. The most expensive was a 3,700 sq. ft. waterfront home on 3.5acres on Beavertail, which closed at $3,875,000, 3% below its asking price. Summary of Single Family Home Sales By Price Point Jamestown, Rhode Island 1st Quarter 2022 vs. 1st Quarter 2021 $0-$200,000 $200,000-$300,000 $300,000-$400,000 $400,000-$500,000 $500,000-$600,000 $600,000-$700,000 $700,000-$800,000 $800,000-$900,000 $900,000-$1,000,000 $1,000,000-$2,000,000 $2,000,000-$5,000,000 $5,000,000+ TOTAL
2022 0 0 0 0 4 3 2 2 1 5 3 0 20
2021 0 0 0 1 2 3 1 1 1 6 3 0 18
Source: Statewide MLS
Under Contract = 271 Active = 591
Pending = 1200
% +/-
-100.00% 100.00% 0.00% 100.00% 100.00% 0.00% -16.67% 0.00% 11.11%
The combination of rising rates and continued low inventory in what remains an extremely competitive market will have interesting implications for the rest of the year. We may see market conditions start to shift and gains soften in the second half. If you’re considering selling, this remains an opportunistic time. If you’re interested in buying, be prepared to move quickly. Whether you’re interested in selling or buying, call us. We’ll help you make the perfect move. Gloria Kurz, Founder & Principal