By JOHN HOWELL Even in these days, Phil Slocum is a glass-half-full guy. This is a good time to sell a house and, it goes without saying, it is also a good time to buy a house. It didn't look that way in March with the shutdown. Open houses were
Even in these days, Phil Slocum is a glass-half-full guy.
This is a good time to sell a house and, it goes without saying, it is also a good time to buy a house.
It didn’t look that way in March with the shutdown. Open houses were canceled, people were told to hunker down and City Hall offices were closed. Everything pretty much came to a standstill. The real estate market was as wobbly as the stock market.
People didn’t know what to expect. They didn’t know if they would have jobs. They didn’t know how things were going to turn out with schools, their vacation plans or, for that matter, whether they could afford to pay their mortgages or rent. It’s not like all those questions have been answered or that there isn’t anxiety over the future and how COVID-19 will alter the future.
Slocum, president of Slocum Real Estate and Insurance, has always believed in home ownership. His business and the real estate business as a whole have adjusted to account for the virus and the market. As one of many changes, while his office remains open on Centerville Road and he imagines there will always be a need for it, only a couple of people actually work from the office. Slocum works from home and stops in occasionally. Calls to his office are answered in person and then patched through to him and associates.
Slocum says COVID-19 has required the firm to make changes they would have been slow to do if at all. Zoom meetings and staff conference calls have become commonplace. Video tours of homes for sale have virtually replaced the open house, although modified versions of the open house are back with lots of precautions involving masks and distancing.
Slocum sees several factors driving the demand for single-family homes, which he said are in short supply. As of last Thursday, Slocum reported 1,368 actively listed single-family homes for sale in Rhode Island. He said for a “balanced market” there would be between 5,000 and 6,000 homes for sale.
The Rhode Island Association of Realtors reported 964 single-family home sales in June as compared to 1,149 for June 2019. According to the Rhode Island Association of Realtors, single-family home sales rose 30 percent from May to June as closings resumed during the initial phase of the economy’s reopening. Pending sales also increased 13.7 percent last month, following three months of year-over-year decline. Pending sales, or those under contract but not yet closed, are typically a sign of closed sales in the one to two months ahead.
The median price of single-family home sales in June rose 3.2 percent to $309,000.
In the release issued by the Rhode Island Association of Realtors, association president Shannon Buss said, “In all the ways the coronavirus has impacted the housing market, its impact on the supply of available properties is the most severe. There is no question that the pandemic has reduced an already low supply of homes for sale by causing potential sellers to delay or reverse their plans to sell. The irony is, given the lack of available homes to choose from and the tremendously low interest rates which are increasing demand, right now sellers are getting top dollar for their homes.”
Slocum sees the pandemic as altering some of the features people are looking for when buying a house. He said they are thinking of working from home as well as having the kids at home because of distance learning. This may mean stepping up to bigger house or interior configurations providing separate spaces. He points out that yard space is also important as people aren’t taking vacations and are now looking to gardening, a pool and other outdoor amenities.
Dean deTonnancourt of HomeSmart Professionals said the shutdown have made some homeowners realize the limitations of their current homes are looking for properties where they can set up a home office rather than working from the kitchen table.
Record low mortgage rates are also driving the market. Slocum said he has never seen rates as low as 3 percent and he can’t imagine they will stay there for long.
“[Interest] rates are so competitive that the [home] prices are not affecting [buying] decisions,” deTonnancourt said.
“Inventory is low because things are selling,” he said. He said his business is up 13 percent from last year at this time.
“I’m fortunate that folks are very busy,” he said.
Rhode Island is hardly unique. According to a report from the National Association of Realtors, sales of previously owned homes rose 20.7 percent in June over the prior month. A report in the July 23 Wall Street Journal quoted Lawrence Yun, chief economist for NAR, an industry trade group, as calling the housing market “red hot” due to a backlog of buyers “trying to taker advantage of the record-low mortgage rates.”
According to the State-Wide Multiple Listing Service, 103 single-family homes sold in Warwick in June at a median price of $255,000. There were 79 sales in Cranston at a median price of $299,000 and 27 in Johnston at a median price of $325,000 for the month.