We are finally getting the statistics showing what I have been witnessing in our offices – activity in the last couple of months has been higher than the recent past.   Just this morning, Clear Capital reported that the Providence Metropolitan Area had the highest rate of growth in housing prices in the nation at 6.1% for the latest rolling quarter ending in February.

In more positive news, the Rhode Island Association of Realtors reported 395 sales in January, a 9% increase from January 2009. The median price rose 14% to $200,000, and days on the market fell 24% to 83.  Condo sales rose 28%, prices remained virtually the same, and days on the market rose 2 percent.  Multi-unit sales fell 21 percent, while price increased 21 percent and days on the market fell 36%.  While January is typically the slowest month for home sales, weather has been on our side unlike other parts of the country that have been paralyzed by record snow this season.

However, the housing market remains vulnerable with unemployment at high levels and consumer confidence lagging. When looking across the country, the housing market is flat.  We also have a long way to go to recover to the home values of 2006.  So, we are not out of the woods just yet, but clear fields are getting closer.

And if the trend is your friend, moving upward or even sideways is better than having a further contraction. Getting back to the activity level, our offices are operating at high levels in this traditionally slow time of year. Maybe it is all the rain we’ve been getting instead of snow. Hopefully, this will continue into the spring market.

As expected,  we continue to show brisk sales as people are taking advantage of great mortgage rates and the first time buyer’s tax credit. The Rhode Island Association of Realtors reported last Wednesday that sales of single family homes rose 29 % in October in year-over-year comparisons, but as we work through the distressed listings, the median sales price continued to decline.  So, though the news is encouraging, we are still working our way out of the doldrums of last year.

Here are the highlights of the RIAR report.

The Single Family Home market is starting to stabilize:

• 787 Single Family homes sold, compared with 621 last year.
• The median sales price was $200,000, down from $215,000 during October 2008.
• 22% of sales were distressed properties, which is approximately the difference between this and last year sales.
• The median price of sales without short sales or foreclosures was $230,000.

The multifamily home market fell slightly in year-over-year comparisons:

• 187 sales in October 2009, down from 193 a year earlier, a 3.1% drop.
• The median price fell from $116,000 to $110,000.
• 18.6 % of those were distressed sales.

Condos had a 35% increase in sales in October compared with the last year:

• 111 sold compared with 82 a year earlier.
• The median price fell 29 % to $161,000 from $227,500.
• 21 % of the sales were distressed, again most of the difference from last year.

With Mortgage rates at historic lows, and lower prices, home affordability conditions are the best on record since 1970. The expanded tax credit should drive the spring market; helping the move-up buyer as well as the first-time buyer. Since potential buyers have until April 30 to have a contract in place, we should continue to see robust sales through  Spring.

This Week’s Real Estate Insight:

By the time the credit expires, we should have worked though enough inventory that prices stabilize or even increase slightly, then the market could stabilize because buyers won’t be paralyzed by worry about further decline in home values.

Tomorrow morning, Sally Lapides will join in a panel discussion hosted by the Rhode Island Association of Realtors reviewing the myths and facts about the Luxury Market here in Rhode Island. This is the 10th part of their series on surviving tough times in the Real Estate market.

The event is free to members of the association and costs $20 for non-members. It will be held at RIAR’s office in Warwick. Space is limited, the event starts at 10:00 am. Call 401.785.9380 and choose option 1 for more information.

The National Association of Realtors reported a 9.4 percent increase in sales of existing homes from August to September, the largest increase in more than two years. Total housing inventory at the end of September fell 7.5 percent to a 7.8 month supply at current sales pace, down from a 9.3-month supply in August. The median existing-home price fell 8.5 percent in September from a year ago to $174,900. Distressed properties accounted for 29 percent of sales and continued to downwardly distort  the median price. Single-family home sales rose 7.7 percent  more than  a year ago. The median existing single-family home price was $174,900, down 8.1 percent from a year ago.

Condominium and co-op sales were up 9.7 percent from August to September, a 21.2 percent increase from a year ago. The median existing condo price was $175,100 in September, down 11.7 percent from a year ago. Sales in the Northeast increased 4.4 percent from August to September, an 11.8 percent increase from a year ago.

The median price in the Northeast was down 7 percent from a year ago, to $234,700. And according to data released by the Rhode Island Association of Realtors today, Rhode Island existing single family home sales rose 27.9 percent in September and days on the market dropped to 87 from a high of 109 earlier this year.  There is currently a 6.8 month supply of single family homes for sale, down from a 14-month supply in January.

This Week’s Real Estate Insight:

Early information from an annual NAR consumer study to be released Nov. 13 shows first-time home buyers accounting for more than 45 percent of home sales in the past year. The National Association of Realtors is lobbying for an extension of the first time homebuyer credit. We Realtors believe that the extension is critical to continued recovery of the housing market.