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brick1972 t1_j5unt6c wrote

It's not just a RI problem.

A lot of people think there is something special here but there isn't.

So the answer to your question is that mortgages got super cheap during covid. But all of the economic stimulus wasn't really needed as much as we thought particularly for white collar professionals. Therefore white collar professionals had money to spend, time on their hands, and low interest rates. This drove prices up. There is also some downstream effect of remote work although Providence isn't really the beneficiary of this in the ways that places in the west were.

Now prices are a bit sticky. They will come down probably but not to 2019 levels unless there is a major correction (which will involve major losses of income etc so might not become a buying opportunity then either). Part of this is that inventory will be artificially depressed because if you are in a home with a 3.25% mortgage why would you be looking to move now if you need to take on a 6% mortgage. Same goes for people who refinanced to low rates.

Also during the runup corporations started buying homes, more than you think. And many individuals buy into get rich quick with short term rental schemes that also depress inventory.

It's all these things. And it's everywhere.

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TzarKazm t1_j5ycnm4 wrote

I suspect that people building up AirB&B empires has a lot to do with it. There are people in my town with a dozen houses for rent. I think it's more damaging than most people realize.

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brick1972 t1_j5ydh7t wrote

Yeah last year I was buzzed by a recruiter about a job in Bend OR. I thought it might be a nice 2-3 year change to go live out there. Then I saw that unless I wanted to live in a trailer park 10 miles out of town I'd need to make about 10% more than my Boston salary to stay even, nevermind the lower salary they were offering. How is it that everyone in a smallish mountain town can afford $800k condos. Then go to VRBO and Airbnb and see about 2000 listings...oh

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cowperthwaite t1_j647z3z wrote

When I've been doing stories on short-term rentals, all the data points to them being highly concentrated in the coastal towns (Newport, Middletown, Portsmouth) and very few everywhere else, especially per capita.

Sub required:

https://www.providencejournal.com/story/news/local/2022/12/12/which-ri-towns-are-regulating-short-term-rentals-like-airbnb/69709637007/

State lookup tool, need to do it by town:

https://elicensing.ri.gov/Lookup/OnlineReportExecute.aspx?queryIdnt=1298

Example: Warwick has 47 current listings but AirDNA, a company that tracks listings, puts it closer to 73.

But Warwick's population is 83k, with 27k single-family homes, 2.4k units in two-family, 1.9k in three familys and 5.5k in apartment complexes.

Source: https://www.documentcloud.org/documents/22416492-part_3_livable_neighborhoods#document/p6/a2149023

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TzarKazm t1_j64aodn wrote

Interesting, thanks for the data and links.

Bristol has 96 official listing so probably has more in reality. It has a population of 22.5k people. Assuming the average AirB&B would house 2.5 people it's about 1% of Bristols housing. I'm not sure that would drop house prices much, but it is a significant amount of housing.

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cowperthwaite t1_j64jmyj wrote

I think a better stat is comparing the number of listings to the amount of Bristol's residential units (usually the census)

That being said, when I looked it up on the census quick facts, it just gave me "X," so to find the numbers requires digging a couple layers deeper.

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