In Depth Analysis: CalculatedRisk Newsletter on Real Estate (Ad Free) Read it here.

Tuesday, May 03, 2011

Housing: Another Price Reduction for Rhode Island Governor's Home

by Calculated Risk on 5/03/2011 07:05:00 PM

Ted Nesi at has been following the price reductions on Gov. Lincoln Chafee's house in Rhode Island: Chafee drops asking price for Providence home by $30,000

[T]he governor and his wife reduced the asking price for their 3,900-square-foot home on Providence’s East Side by another $30,000.

The Chafees are now seeking $799,000 ... That’s down 10% from the initial listing price of $889,000 they sought in mid-February. The Chafees had already reduced the price to $829,000 last month.

The Chafees bought the house for $939,000 in 2006
When this house was first listed, I argued we'd see a price reduction. Although Case-Shiller doesn't (edit) provide a publicly available index for Providence, house prices have fallen about 15% in Boston and 23% in New York - and that would suggest a selling price in the $700s for the Chafees' home. So many homeowners are unwilling to price their homes realistically - at least the Chafees have been willing to reduce the price.

Update: There are Case-Shiller MSA indexes for 139 metro areas, but this data is quarterly and not publicly available. Fiserv was kind enough to provide me the MSA data for Providence-New Bedford-Fall River, RI-MA Metropolitan Statistical Area - and this shows prices were down 22.4% from Q4 2005 thourgh Q4 2010, and down 16.1% from Q4 2007 through Q4 2010. A 22.4% decline would put the Chafees home price around $729,000.