Newport Daily News, October 29-30, 2005

By Nat Binns

Daily News Staff

Good news for home seekers

Prices of houses in Newport County are not going down, but they're not going up as fast as they were a year ago.

While local housing costs remain higher than other parts of the state, the market is showing signs of leveling out, providing some balance to what has been a seller-friendly real estate economy.

The number of houses, and the time those homes have stayed on the market, went up during the first half of 2005 compared to the same period in 2004, according to numbers recently released by the Rhode Island Association of Realtors.

These numbers indicate the housing market could become more balanced, giving buyers a break from record-high prices, according to Michael Young, president of the Realtors association.

Young said the market remains strong for homeowners looking to sell, but instead of continued increases, housing costs have started to flatten out.

"I think we are seeing a moderation in terms of pricing going up. We're starting to see a balanced market." Young said. "But as long as interest rates are staying below 6 or 7 percent and the job situation remains good, it will continue to be a healthy market."

The number of single-family home sales was steady in Newport, Jamestown and Portsmouth but went down 31 percent in Middletown and up 25 percent in Tiverton.

Statewide, Little Compton and Jamestown came in as the two most expensive places to buy a single-family home, with median sales prices of $582,500 and $558,750, respectively.  That price represented a 36 percent jump in Jamestown, where the median value a little more than $400,000 after the first half of last year.  Jamestown's increase was the largest in the state, where the average median price went up 7.6 percent.

Kerry Benson, a spokeswoman for Lila Delman Real Estate, said prices went up in Jamestown as buyers who could not find deals on Aquidneck Island were forced to look elsewhere. When Jamestown became an attractive option, the price of real estate shot up, she said.

"People are looking for that deal," Benson said. "If they're not finding it in Newport, they'll look somewhere else." The Newport County market draws many buyers looking for higher-end waterfront property, and that will not change, Benson said.

"Newport County still has a very dynamic market," she said. "It is more active, there is more momentum behind it."

But like other areas, the local market will level, even if prices remain higher than the state median, according to local Realtors.

The average increase per year in Rhode Island has hovered around 20 percent, Young said, and the comparatively modest 7.6 percent bump is another hopeful sign for potential buyers.

Young said that if numbers had continued to rise, the market would have dried up. "At some point we would find ourselves priced out of the market," he said.