Boston’s home buyer migration into the suburbs — and into the Ocean State — continued during the pandemic.
Residents of Boston’s urban core looked for more space afforded by single-family homes in suburbia, but that urban exodus appears to have affected only Massachusetts’ largest city and not Rhode Island’s.
Vacancies at apartment and condo buildings rose nationally over the past year but not in Providence — which had a 2.2 percent vacancy rate at the end of the second quarter compared with the 5.2 percent national average, according to CoStar data.
The 518 single-family home sales recorded in 2021 in Providence as of July were more than half what the city saw in all of 2020 (916), indicating that it will surpass last year’s annual tally, according to The Warren Group, a real estate analytics firm. But the most impressive showing came from Providence condo sales: The 327 sales in the city for the first seven months of this year nearly eclipsed the 375 seen all last year and the 389 recorded in 2019.
“People are recognizing Providence is a culturally vibrant city,” said Steven Miller, a realtor with Coldwell Banker. “It really gives some people a lot of options in terms of being like, ‘Wow, I can get a lot of the same things that I would get in Boston in a city that’s very equal.’ It’s only an hour from Boston and three hours from New York. I mean, that’s why I moved here [from Manhattan] 15 years ago.”
According to United Van Lines’ National Movers Study, the percentage of people moving to Rhode Island has grown every year, while the percentage of residents leaving has shrunk. The percentages were about even in 2018, the study indicated, but in 2019, 52.9 percent were moving in, while 47.1 were headed out. Last year, those figures were 55.5 percent and 44.5 percent, respectively.
Providence may be a smaller city than Boston, but it has similar attributes: top-tier universities, a stop on the Amtrak Acela Northeast Corridor, and easy access to the rest of New England — just to name a few. But it comes at a fraction of the cost, even if media reports in Rhode Island portray the local housing market as one getting more expensive by the day.
The median single-family home price in Boston in July was $785,000 — according to the Greater Boston Real Estate Board — compared with $270,000 in Providence, per The Warren Group report. The median condo price in Providence was $277,000 compared with $640,000 in Boston.
The median monthly rent in Providence is $1,545 compared with $2,300 in Boston, according to the Zumper real estate site. But the time to find a deal in Rhode Island is likely now, as more people from places beyond Boston wake up to the greater affordability found in a city like Providence.
“Rents have also been on the rise, as migration from Boston, Connecticut, and New York have fueled additional renter demand,” Aaron Jodka, national director of US capital markets research at Colliers, said via e-mail. “The return of college students to campus is also providing an additional boost.”
Potential home buyers in the market should still be aware that some parts of Providence are more attractive — and competitive — than others. Single- and multi-family homes below $800,000 on the city’s East Side near Brown University and Rhode Island School of Design are a hot commodity, while anything below $500,000 is attractive to buyers on the West Side, Miller said.
A silver lining is that some of the necessities in scoring a winning bid for a home in Greater Boston, like offers over asking and waived mortgage and inspection contingencies, aren’t as common in Providence in recent months.
“It’s not as frenetic as it has been in the past,” Miller said. “I’m seeing a lot of buyers being able to negotiate things with sellers like the price of the home, or they’re negotiating having repairs done prior to closing. That’s happening a little bit more so than it was earlier this year.”
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