This is still the era of superlatives in the real estate market. “Unprecedented.” “Historic.” “Crazy.” “Wild.” “Never before.” These are …
This is still the era of superlatives in the real estate market. “Unprecedented.” “Historic.” “Crazy.” “Wild.” “Never before.” These are the terms used to describe the real estate market of the past two-plus years. This has been the era of 24-hour sales cycles, mobbed open houses, fierce bidding wars, sales-over-asking, skyrocketing prices, barren inventory.
Heading into the fall of 2022, these phenomenon are still happening. But …
They’re not happening as frequently. They’re not happening everywhere. And conditions are beginning to tip back toward a little more normalcy.
Local real estate agents agree. They are seeing modest signs of change.
“In the past 30 or 40 days we’re seeing things shift,” said broker and agent Paula Martel of Century 21 Topsail. “We’re transitioning from a period where everything, absolutely everything, was selling above asking price, to where now maybe 40 percent of properties are going above asking … That leads me to believe we’ve hit the top.”
Martel said there are inconsistencies across the market. She described “pockets” in the market where things are still as hot as ever. “Bristol’s west side is still the craziest thing I’ve seen in my real estate history,” she said. Properties along the town’s western shorelines — Ferry Road, the downtown district, Poppasquash, the Highlands, North Farm — even continuing to the Warren neighborhoods and condo complexes near the Bristol town line, have seen soaring prices and rabid buyers. Martel said that is also the case in areas like the East Side of Providence and the Darlington area of Pawtucket.
“When you’re in those little pocket areas, you still get the same behaviors … It’s drawing a higher-income-bracket buyer. They have good credit, they have good incomes, and they’re competing for good listings,” Martel said.
Yet in other areas of Bristol, and other areas of the region, things have cooled slightly. Properties are still selling relatively quickly, but at or slightly below asking prices — if they are priced correctly.
Set the right price
Elizabeth Kirk and Lisa Schryver of Residential Properties lead one of the top real estate teams in the region. Both said the most important factor in today’s market is price. “The biggest thing we’re seeing is pricing. Some sellers were trying to put a crazy number on their property … Buyers aren’t really going for it anymore,” Kirk said. “We’re seeing price drops now, and we weren’t really seeing that before.”
She said the newer trend is happening at all levels of the market, from $400,000 to north of $1 million. Buyers are competing for homes, but not as rabidly as they were in 2021 or the first half of 2022.
“The market is really strong, and it will stay strong,” Kirk said, “but no matter what price point you’re in, you have to be priced correctly.”
Her partner agreed. “It’s always been about location, price and condition, and those all still are important,” Schryver said.
There’s more evidence that the frenzied culture of the past two years is showing signs of abating. “First time in months, we had someone ask for inspection items to be fixed,” Schryver said. For a while, that simply wasn’t happening. Buyers were making full-cash offers, waiving all inspections, and signing as quickly as possible. Now some of them are slowing down a bit.
“Barrington is still a really desirable spot. The whole East Bay really is,” Kirk said. “There is still demand. The inventory is still low. It’s still a seller’s’ market, definitely. The key is correct pricing.”
A boom for multi-families
Martel said one of the still-surging “pockets” in the market are multi-family homes. The trend is directly tied to interest rates.
She said first-time homebuyers are getting squeezed by rising interest rates, which the feds have been increasing in an effort to thwart inflation. As their buying power has diminished, these first-time buyers have turned to the multi-family market. They can buy a home, live in one of the apartments, and rely on their renters to subsidize or even cover their mortgage payments.
“Multifamily demand is getting even higher, and properties are going at crazy prices,” Martel said. “It’s high-demand, it’s a free for all, it’s a frenzy. And they’re usually sold before they hit the market.”
For the past few years, multi-family properties have been a playland for investors. They’ve been buying, renovating, flipping and renting properties for income. Now, Martel said, many of those investors are slowing down, opening the door to the first-time buyers, many of whom are educated on the market and ready to pounce.
“When you put a good, solid property out there, the buyers are so savvy, they’ll go after it quickly, even above-asking,” Martel said.
So the market today isn’t quite what’s it’s been for the past two-plus years — except in places where it still is.