Should Rhode Island Government Control Rent Increases?

         The Pro's and Con's of RENT Control

Apartment rents in the Providence-Warwick metropolitan area are rising faster than anywhere else in the country, according to a new analysis by rent.com.

The Providence metro median rent rose by 21.55% year over year in December to $2,752, the highest percentage increase among the 50 metro areas analyzed by the Atlanta-based apartment search engine. The Columbus, Ohio metro was second with an 11.56% year-over-year increase to $1,747.

Researchers analyzed rental property prices to identify median rent prices at the national, state and metro levels. The analysis combined inventory and bedroom types into one median that covers all available rental units at the time.

The national median price for an apartment in December was $1,964, 40% lower than the median price in the Providence metro, which includes all Rhode Island counties and Bristol County, Mass.

Source-Providence Business News February 2, 2024

In recent years, the issue of affordable housing has become increasingly prominent in Rhode Island and other parts of the country sparking debates over the role of government in regulating rent increases. Advocates argue that controlling rent hikes is essential for ensuring housing affordability and stability, while critics raise concerns about potential negative impacts on property owners and the housing market as a whole. In this blog post, we will delve into the pros and cons of government intervention in controlling rent increases.

Pros:

1. Affordable Housing: According to Robert Scaralia Education Director at the Real Estate Institute of Rhode Island said one of the primary arguments in favor of government control of rent increases is its potential to maintain affordable housing options for residents, especially in areas where housing costs are soaring. By capping rent increases, governments can help prevent price gouging and ensure that individuals and families have access to stable and reasonably priced housing.

2. Social Equity: Rent control measures can promote social equity by preventing displacement and gentrification of lower-income communities. Without government intervention, rapidly rising rents in desirable neighborhoods can force long-term residents out of their homes, leading to socioeconomic segregation and inequality.

3. Economic Stability: Rent control policies can contribute to economic stability by providing tenants with predictable housing costs. This stability allows individuals and families to budget more effectively, reducing financial stress and potentially stimulating consumer spending in other areas of the economy.

4. Mitigating Homelessness: By stabilizing rental prices, government intervention can help mitigate homelessness by reducing the risk of eviction due to unaffordable rent increases. Stable housing is crucial for individuals and families to maintain employment, access education, and lead healthy lives.

Cons:

1. Market Distortion: Critics argue that government control of rent increases distorts the housing market by artificially suppressing rental prices. This can disincentivize investment in rental properties, leading to a shortage of available housing units and exacerbating affordability issues in the long run.

2. Property Rights: Opponents of rent control measures often highlight concerns about infringement on property owners' rights. Property owners argue that they should have the freedom to set rental prices based on market demand and property maintenance costs without government interference.

3. Maintenance and Investment: Rent control policies may discourage property owners from investing in property maintenance and upgrades. With limited ability to increase rental income, owners may have less incentive to invest in improving the quality of rental units, potentially leading to deteriorating housing conditions over time.

4. Shortage of Rental Units: Rent control measures can contribute to a shortage of available rental units in high-demand areas. Landlords may be less inclined to rent out their properties if they cannot adjust rents to match market conditions, leading to decreased rental housing supply and increased competition for existing units.

The debate over government control of rent increases is complex, with valid arguments on both sides said Scaralia. While rent control measures aim to promote housing affordability and stability, they also raise concerns about market distortion and property rights. Finding a balance between protecting tenants and respecting property owners' rights is essential in crafting effective housing policies that address affordability challenges while maintaining a healthy housing market. Ultimately, a nuanced approach that considers the unique dynamics of each housing market may be necessary to achieve sustainable solutions to the ongoing affordable housing in Rhode Island

For more information about housing and the statistical analysis of Rhode Island cities and towns contact the Real Estate Institute of Rhode Island.

www.InstituteRI.com

Kent County, Rhode Island Real Estate Market Analysis December 2023

Kent County, Rhode Island

Market Metrics Report December 2023

Real Estate Institute of Rhode Island

www.InstituteRI.com

Let's start by examining the "Months Supply of Inventory," which currently stands at 1.52. This metric represents the number of months it would take to sell all the available properties on the market, given the current sales pace. A lower number indicates a seller's market, where demand exceeds supply, leading to potentially higher prices and faster sales.

Now, let's consider the "12-Month Change in Months of Inventory," which shows a significant decrease of -8.98%. This means that compared to the previous year, there has been a substantial reduction in the amount of time it takes to sell available properties.

Moving on to the "Median Days Homes are On the Market," we find that properties spend an average of 18 days before being sold. This metric highlights the swift pace at which homes are being snatched up by eager buyers. For sellers, this means a potential quick sale, while buyers must act swiftly to secure their desired properties.

Let's now turn our attention to the "List to Sold Price Percentage," which stands at an impressive 99.8%. This metric indicates that homes are being sold very close to their initial listing price. Such a high percentage suggests that sellers are experiencing minimal price reductions and are able to secure favorable offers.

Lastly, we come to the "Median Sold Price," which currently sits at $383,750. This figure represents the middle point of all home sale prices in the market. This median value gives us a general idea of the market's overall price range.

The short "Median Days Homes are On the Market" further reinforces the notion of a fast-paced market, where buyers must act promptly to secure their dream homes. The high "List to Sold Price Percentage" signifies that sellers are achieving prices close to their initial listing price, showcasing their bargaining power in negotiations.

Finally, the "Median Sold Price" of $383,750 gives us an idea of the price range within this market. It is important for both buyers and sellers to analyze these metrics to align their expectations and make informed decisions.

For more information about the Rhode Island real estate market contact the Real Estate Institute of Rhode Island.

980 Reservoir Ave

Cranston, RI 02910

401-943-8500

www.InstituteRI.com

Rhode Island Real Estate Market Update

Rhode Island Real Estate Market December 2023

The year ended with much optimism for a strong 2024. The median price of a single family home in Rhode Island was $427,000 and inventory was at one and a half months.  

Definitions explained.

The medium price of a home refers to the middle value in a list of home prices arranged in ascending or descending order. Unlike the average, which is calculated by summing up all the prices and dividing by the number of homes, the median is the middle point that separates the higher half from the lower half of the data set. In the context of real estate, the median home price provides a more representative measure than the average, as it is not influenced by extreme values that can skew the overall perception of the housing market. It offers a more accurate reflection of the typical cost of homes in a given area, making it a useful metric for assessing the affordability and overall market conditions.

Months of inventory, in real estate terms, refers to the number of months it would take to sell the current inventory of homes on the market, given the current sales pace. It is a key metric used to assess the balance between supply and demand in the housing market. The calculation is typically done by dividing the number of active listings by the average monthly number of closed sales. A higher number of months of inventory suggests a buyer's market, indicating more supply than demand, while a lower number suggests a seller's market, with higher demand than supply.

The Real Estate Institute of Rhode Island is a real estate school offering licensing classes, continuing education and general real estate studies.

www.InstituteRI.com

Rhode Island Gov. 100 Million for Housing 2024

100 Million bond for Rhode Island Housing

Rhode Island- In the State of the State address Rhode Island Gov. Dan McKee pledged 100 million for a housing bond as requested by the Rhode Island Housing Secretary Stefan Pryor, this would be the largest in state history. Some say it's too much, others are saying it's not enough.
“These dollars will create more inventory and help put young people on a path to homeownership in our state,” McKee said. “ We know that homeownership is one of the top ways to build generational wealth.”

According to Robert Scaralia Director of Education at the Real Estate Institute of Rhode Island in a joint statement with REMAX 1st Choice said, this is good news for Rhode Island because the state is suffering from both a housing shortage and a affordability challenge.  One of the key areas to increase affordable housing in Rhode Island is through changes in local land use controls, mainly with changing the cities and towns requirements for minimum lot sizes. Too often the minimum lot square footage requirement is well above 8,000 square feet, when an 8000 square foot lot affords every homeowner a generous front and back yard.

Smaller residential lot sizes are a crucial solution to address the pressing issues of housing inventory and affordability. This not only maximizes land utilization but also facilitates the development of more affordable housing options. With a focus on efficiency and thoughtful planning, this approach empowers communities to accommodate more residents without compromising quality. In essence, embracing smaller residential lot sizes is a strategic move towards a more inclusive and accessible housing market, fostering sustainable growth and improved affordability for all who call or would like to call Rhode Island their home.

Real Estate Institute of Rhode Island

What fields do the most successful real estate agents come out of?

While there isn't a definitive ranking for industries that make someone a great real estate agent, certain backgrounds and skills can be advantageous in the real estate industry. Here are ten industries that individuals often transition from to become successful real estate agents:

1. Sales and Marketing: Experience in sales and marketing helps agents promote properties effectively and negotiate deals.

2. 
   

3. Finance and Banking: Knowledge of finance and lending can be valuable when dealing with mortgages and helping clients secure financing.

4. 
   

5. Customer Service: A background in customer service is beneficial for building strong client relationships and providing excellent service.

6. 
   

7. Construction and Architecture: Understanding the basics of construction and architecture can aid in evaluating property conditions and advising clients on potential improvements.

8. 
   

9. Entrepreneurship: Entrepreneurs often possess the self-motivation and business acumen necessary for success in real estate.

10. 
    

11. Legal Professions: Lawyers and paralegals may find their legal knowledge beneficial in navigating complex real estate transactions.

12. 
    

13. Technology and IT: Tech-savvy individuals can leverage digital tools and platforms to streamline processes and market properties online.

14. 
    

15. Teaching and Education: Communication and educational skills are useful for explaining real estate processes to clients and helping them make informed decisions.

16. 
    

17. Social Work: Compassion and empathy gained in social work can be valuable when understanding clients' needs and guiding them through emotional aspects of real estate transactions.

18. 
    

19. Hospitality: Professionals from the hospitality industry often excel in customer service, which is crucial for client satisfaction in real estate.

It's important to note that success in real estate is not solely dependent on industry background. Soft skills such as communication, negotiation, and networking are also critical for a real estate agent's success.

Ready to see where a Rhode Island real estate license can take you?

Visit www.InstituteRI.com for more information including class schedules and enrollment.

Discovering your passion, a real estate agents story.

"We share these stories because they are similar to most. We are inspired by people like Emma who have the courage and determination to seek a better life".

Emma found herself trapped in the monotony of her nine-to-five job. Day after day, she toiled away at a desk, her dreams stifled by the humdrum routine and the constant struggle to make ends meet. The meager salary barely covered her expenses, leaving her unfulfilled and yearning for something more.

One evening, while online Emma stumbled upon a real estate course offered by the Real Estate Institute of Rhode Island, Intrigued by the promise of financial freedom and the potential to break free from the shackles of her uninspiring job, she decided to attend and she reasoned for just a $325 investment the financial risk was minor but the rewards could be life changing.

Emma knew of others who became successful in the world of real estate, with limitless opportunities for those willing to take the plunge. Inspired and motivated, Emma decided to embark on a new journey.

She enrolled in real estate courses, dedicating evenings and weekends to learn about real estate principles and practices. It wasn't an easy transition – there were challenges, uncertainties, and moments of self-doubt. However, Emma's determination moved her forward and she earned her real estate license.

With each successful sale, Emma felt a sense of accomplishment that had eluded her in her previous job. The financial rewards started pouring in, and her satisfaction soared. Emma's newfound passion for real estate not only transformed her professional life but also enriched her personally.

As she helped people find their dream homes, Emma discovered a profound joy in making a positive impact on others' lives. The connections she forged with clients and colleagues created a sense of community that was absent in her previous job.

Emma's journey from a discontented employee to a successful Rhode Island real estate agent became an inspiring tale. Her story resonated with others who, like her, had been yearning for a change.

In the end, Emma realized that true fulfillment wasn't just about financial success; it was about finding a path that aligned with her passions and values. Becoming a real estate agent in Rhode Island had not only opened doors to prosperity but had also unleashed her true potential, bringing a sense of joy and contentment to every aspect of her life.

Like Emma, see where a Rhode Island real estate license can take you.

www.MyAgentLicense.com

While Emma's story is true, the name has been changed for confidentiality.