Skip to content
  1. Rhode Island
  2. Home Buying

Home Buying in Rhode Island

Downtown Providence Rhode Island

From charming coastal towns like Narragansett and Watch Hill to the vibrant and historic cities of Providence and Cranston, Rhode Island offers homebuyers diverse living environments. Known as the "Ocean State", Rhode Island's coastal beauty, historical landmarks, and easy access to major cities like Boston and New York make it a desirable place to live. However, buying a home in Rhode Island can be challenging, particularly in areas where high demand and limited supply drive up prices.

The median home price in Rhode Island is approximately $490,000, higher than the national average but still lower than neighboring Massachusetts, which continues to be one of the most expensive housing markets in the country. Coastal areas like Newport and Narragansett see higher home prices due to their desirable locations, with median prices exceeding $700,000. With demand often outpacing supply, especially near the coast, Rhode Island is largely a seller's market. Homes spend an average of about 30 days on the market, but that number decreases in popular areas.

Rhode Island's population growth remains moderate, even though the state has seen many people move in. It is one of the top "moved-to" states in the country. Most people coming into Rhode Island from out of state are drawn by the relatively affordable housing market compared to nearby states like Massachusetts, an attractive coastal lifestyle, and job opportunities in certain sectors.

Rhode Island's small size belies its diversity in living environments. Whether you're drawn to the historic charm of Providence, the peaceful shores of coastal towns, or the rural beauty of its northern regions, Rhode Island offers great options for an array of lifestyles. Its proximity to New York and Boston makes it great for commuters.

No matter where you end up in the state, home buying in Rhode Island requires careful financial planning, thorough research, and collaboration with a knowledgeable area realtor.

Current Rhode Island Housing Trends

Understanding Rhode Island's housing trends is crucial for making informed decisions.

Here are some important metrics:

  • Rhode Island Median Home Price

    The median home price in Rhode Island is around $490,000, though prices vary significantly depending on location. Coastal areas like Newport often see prices above $800,000, while inland cities like Woonsocket have more affordable options with median prices closer to $350,000.

  • Number of Homes Sold

    In Rhode Island, roughly 1,000 homes sell each month. Coastal areas may experience higher selling activity, particularly in summer, when homebuyers and investors turn their attention to vacation homes. The real estate market in cities like Providence and Warwick generally remains active year-round.

  • Median Days on Market (DOM)

    Rhode Island's median DOM figure, the median amount of days a home stays on the market before selling, is roughly 30 days. However, the Providence metro area actually has one of the lowest median DOMs in the country, with an average of 14 days. The median DOM is even shorter in the area's most desirable neighborhoods.

  • Supply Statistics

    Rhode Island faces a housing shortage, especially in coastal areas where new construction is limited. The lack of available homes has increased buyer competition, particularly in popular vacation towns and cities with strong rental markets. Rhode Island averages a two-month housing supply, reflecting how long it would take to sell all the homes on the market if no new listings were added. A balanced market has a five-to-six-month supply of houses.

How to Find the Right Home to Buy in Rhode Island

How to Find the Right Home to Buy in Rhode Island

When buying a home in Rhode Island, partnering with a local realtor is essential. A knowledgeable real estate agent understands the nuances of Rhode Island's housing market and will guide you through the entire process. They will work with you to determine your financial stability, lifestyle needs, and long-term goals to help you find the perfect home. Be sure to choose an agent with strong communication skills, experience in the market you're considering, and strong references. You can also ask family or friends for referrals.

Finding the Right Home

If you want to find the right home in Rhode Island, you and your realtor will want to be on the same page about several key factors every homebuyer must consider, including location, type of home, and the cost of homeownership, including how much you should expect to pay in taxes.

Location

Location is one of the most important considerations for homebuyers in Rhode Island. From the vibrant city life of Providence to the coastal beauty of Newport, homebuyers must weigh the benefits of each location when choosing where to live.

  • Urban vs. suburban vs. coastal: Providence, the state capital, provides vibrant urban living with a bustling arts scene, historic architecture, and many employment opportunities, making it ideal for professionals. Suburban cities like Warwick and Cranston offer family-friendly neighborhoods, excellent schools, and parks. They offer a balance of space and convenience. For those drawn to waterfront living, Rhode Island's coastal towns like Newport and Narragansett deliver stunning beauty and a high quality of life. However, home prices are generally higher in these areas.
  • Proximity to work and Public Transportation: Many Rhode Island residents work in neighboring Massachusetts or Connecticut, making proximity to major highways and public transportation an important consideration for homebuyers. The Rhode Island Public Transit Authority (RIPTA) is the main public transportation provider in Rhode Island, operating buses, paratransit vans, and flex vans. Its main hub is Kennedy Plaza in downtown Providence, with other hubs in Newport, Warwick, and Pawtucket-Central Falls. The Massachusetts Bay Transit Authority (MBTA) provides public transportation in Eastern Massachusetts and Rhode Island, including commuter train service to Providence and Warwick. Living near bus routes or commuter hubs can enhance convenience, especially for those commuting to Boston or New York.
  • School Districts and Property Taxes: Both school districts and property taxes are critical factors to consider when buying a home in Rhode Island. The state is known for its quality public and private schools, with towns like Barrington and East Greenwich standing out for their top-ranked education systems, making them attractive to families seeking the best for their children. However, these high-quality school districts often come with higher property taxes, which are used to fund public services, including education. Property tax rates vary by location, with coastal and suburban areas generally having higher rates. Homebuyers must weigh the benefits of excellent schools and proximity to amenities against the long-term affordability of property taxes, especially in high-demand areas like Newport and Narragansett. Factoring in property taxes is essential to understanding the true cost of homeownership in the state.

Types of Homes in Rhode Island

Rhode Island offers a variety of home types, including:

  • Single-Family Homes: Single-family dwellings are the most popular type of home among Rhode Island homebuyers, and they are predominantly found in suburban and rural areas. They offer privacy and space but come with maintenance responsibilities. All types of single-family homes are available, including historic and waterfront homes.
  • Historic Homes: Rhode Island is known for its well-preserved historic homes, especially in Newport and Providence. These homes, often dating back to the 18th or 19th century, provide unique architectural charm and a connection to the state's rich history. However, they usually require more upkeep and renovations to meet modern living standards, which can add to the overall cost of ownership.
  • Waterfront Properties: Waterfront homes are abundant in Rhode Island, particularly in coastal towns like Newport. These homes offer stunning views but have higher insurance premiums and maintenance costs.
  • Condominiums: Popular in urban areas like Providence, condos offer low-maintenance living and shared amenities. However, they often come with homeowners' association fees, which should be factored into your home-buying decision.

The Home-Buying Process in Rhode Island

The Home-Buying Process in Rhode Island includes the following steps:

  • Get prequalified for a home loan.
  • Work with a local real estate agent.
  • Make an offer on your desired property.
  • Schedule a home inspection.
  • Close on the home and complete the necessary paperwork.

Financing Your Home Purchase in Rhode Island

Financing Your Home Purchase in Rhode Island

Several financing options are available to Rhode Island homebuyers, including traditional mortgages and government-backed home loans.

Traditional Mortgages

In Rhode Island, homebuyers generally choose between two types of traditional mortgage options:

  • Fixed-Rate Mortgages: A fixed-rate mortgage is an excellent choice for Rhode Island homebuyers who plan to stay in their home long-term. Consistent monthly payments and a stable interest rate over the life of the loan offer predictability and peace of mind.
  • Adjustable-Rate Mortgages (ARMs): ARMs allow homebuyers to benefit from lower initial payments, with interest rates that adjust periodically based on market conditions. This option is ideal for buyers who plan to sell or refinance before the rates increase or when market rates are expected to drop.

Most Rhode Island homebuyers rely on major national lenders like Wells Fargo, Bank of America, and Chase for their home loans. Local lenders such as Navigant Credit Union and BankNewport are also popular, offering personalized service and mortgage options tailored to Rhode Island's unique real estate market.

Government-Backed Loans

Rhode Island homebuyers may qualify for several government-backed loans, including:

  • Rhode Island Housing (RIH) Loans: RIH offers "first-time homebuyer" and "homebuyer renovation" loans to qualifying buyers. Each has 100% financing available and no down payment required.
  • FHA (Federal Housing Administration) Loans: FHA loans are popular among first-time homebuyers due to their lower down payment requirements and more lenient credit score criteria.
  • VA (Veterans Affairs) Loans: Available to veterans and active military personnel, VA loans offer favorable terms, such as no down payment and lower interest rates.
  • USDA (United States Department of Agriculture) Loans: USDA loans are designed for homebuyers in rural areas and offer no down payment options. Northern and rural areas of Rhode Island often qualify for this program.

Down Payment Assistance Programs

Rhode Island offers several down payment assistance programs. First-time homebuyers can benefit from programs like Rhode Island Housing's 15kDPA program, which provides $15,000 in assistance for down payment and/or closing costs through a 0% interest rate loan. Additionally, many Rhode Island cities and counties offer local down payment assistance programs, so check with local housing authorities for more details.

Rhode Island Home Insurance

Rhode Island Home Insurance

Home insurance is necessary for most Rhode Island homeowners, especially in coastal areas prone to storms and flooding. While home insurance in Rhode Island averages about $1,600 annually, below the national average, homes in flood-prone regions require additional flood insurance, which can increase costs.

Home Buying Challenges in Rhode Island

Rhode Island's small size and coastal appeal present some unique challenges for homebuyers:

  • High Prices in Coastal Areas: Coastal properties often come with higher price tags and increased insurance costs due to the risk of flooding and hurricanes.
  • Limited Inventory: Rhode Island's limited housing stock, particularly in popular areas of the state, can make it difficult for homebuyers to secure their ideal property.
  • Competing Offers: Competitive markets, especially in coastal vacation towns, often result in bidding wars, making it harder for buyers with financing contingencies to compete against cash offers.

Rhode Island Home Inspections

Rhode Island is the smallest state in the union, located on the East Coast. This tiny state has some of the nastiest weather, like severe storms, flooding, cyclones, heavy winter storms, and devastating tropical storms. Because of this, home inspections in Rhode Island often reveal damage like roof damage, structural integrity issues, and mold. Rhode Island home inspections are crucial for buyers looking to purchase real estate. Before buying, they need to ensure the house is what it appears to be, without any costly repairs looming.

A home inspection in Rhode Island examines the house's structural integrity, major systems like plumbing, HVAC, and electrical, safety features, and appliances. Some of the items found on the inspection list are:

  • Structure: Foundation, walls, columns, chimney, crawlspaces.
  • Attic: Framing, sheathing, insulation, ventilation, electricity, HVAC, and ductwork.
  • Roof: Shingles, flashing, skylights, and gutters.
  • Garage: Doors, door opener, fire separation, walls/ceiling, slab, cabinets.
  • Plumbing: Supply line, main valve, pumps, water heaters, and fixtures (toilets, sinks, tubs, faucets, showers).
  • HVAC: Heating and cooling systems, ductwork, ventilation.
  • Electricity: Panels, circuit breakers, outlets, and fault breakers.
  • Interior: Walls, floors, doors, windows, doorbell, closets, ceilings.
  • Safety: Smoke detectors, carbon monoxide alarms, and fire sprinklers.
  • Exterior: Walkways, grading, drainage, driveway, and other property areas.

A home inspection in Rhode Island costs between $300 and $600, depending on the square footage, location, and specifics of the inspection.

The Process

In Rhode Island, typically, buyers pay for home inspections before purchasing because it benefits them. The inspection occurs after signing the purchase agreement and making an offer. Once the seller accepts, they can move forward and order the inspection. The process goes as follows:

  • Find and hire a reputable home inspection firm.
  • Schedule the inspection according to your purchase contract.
  • Show up and stay for the entire inspection; ask questions as needed. The inspection will last two to four hours.
  • Review the inspection report and decide what to do next.

The top five home inspection companies in Rhode Island are:

After the Inspection

After the inspection, the inspector takes a few days and compiles their findings in a comprehensive report, which they issue to the buyer. The buyer reviews the report, and if the inspector finds anything that needs addressing, the buyer can:

  • Save money by negotiating a lower price.
  • Ask the seller to make all repairs before closing.
  • Ask for a home warranty.
  • Back out of the sale altogether.
  • Ask to put down less for the down payment.

Inspection Top Cities

City Inspection Cost Local Issues Local Rules Local Home Types
Home Inspection in Providence $300-$500 depending on the property's size, location, and other factors. Plumbing, electrical, roof, HVAC, and foundation cracks. Specific requirements for example electrical work must be done by a licensed electrician. Single-family, row houses, and apartments.
Home Inspection in Cranston $400-$600 for a single-family home. Roof, plumbing, HVAC, water damage, and mold. Not mandated by law but highly recommended. Federal, Georgian Revival, Late Victorian Domestic, and Colonial.
Home Inspection in Warwick $395-$550 based on the square footage and radon or pest tests. Roof, HVAC, electrical, plumbing, and foundation. Inspectors cannot do an electrical inspection; the buyer must hire a licensed electrician for that. Single-family, condos, townhomes, and waterfront properties.
Home Inspection in Pawtucket $395-$550 depending on the size and type of property. Plumbing, roof, electricity, HVAC, mold, and poor ventilation. Not required before the sale of property. Single-family, condos, townhomes, and apartments.
Home Inspection in East Providence Starting at $395 for homes under 1,500 square feet. Roof, drainage, HVAC, termites, and water damage. No local rules. Cape, Colonial, and Raised Ranch.

Navigating Your Rhode Island Home-Buying Journey

From its vibrant urban settings to its picturesque coastal towns and all the peaceful rural areas throughout the rest of the state, Rhode Island offers many unique options for homebuyers. However, its competitive housing market presents several challenges, particularly in high-demand coastal regions. Homebuyers face high prices, especially in Newport and Narragansett, and limited inventory, making it especially difficult for first-time buyers.

If you want to successfully navigate the Rhode Island home-buying process, whether you're a first-time homebuyer or a seasoned investor, careful planning and thorough research are essential. Prospective buyers should stay informed about current housing trends, secure financing early, and partner with a knowledgeable local realtor who understands the nuances of the state's market.

Additionally, it's important to consider factors such as property taxes, school districts, and proximity to work or public transportation to ensure the chosen home fits your long-term lifestyle and financial goals.

Despite the challenges, Rhode Island's diverse living environments and proximity to Boston and New York offer plenty of opportunities for homebuyers. Rhode Island's housing market provides something for everyone willing to navigate its dynamic intricacies. With proper preparation, expert guidance, and a clear understanding of the market, you can find the home that fits your needs in the Ocean State.

Instant Access to Rhode Island Property Records

Home Buying Guide

Instant Access to Rhode Island Property Records

  • Owner(s)
  • Deed Records
  • Loans & Liens
  • Values
  • Taxes
  • Building Permits
  • Purchase History
  • Property Details
  • And More!

Instant Access to Rhode Island Property Records

  • Owner(s)
  • Deed Records
  • Loans & Liens
  • Values
  • Taxes
  • Building Permits
  • Purchase History
  • Property Details
  • And More!

Instant Access to Rhode Island Property Records

Home Buying Guide

Rhode Island Property Resources