Cautiously good news for Charlestown homeowners

Modest gains in home values continue through July

Sale prices and home value slowly coming back

By Will Collette

Zillow.com’s new numbers for Charlestown show home values and sale prices are slowly climbing out of the toilet, although we’re still short of $300,000 as the average Charlestown home price.

Charlestown home values are still down 3.3% from July of last year, but several months of upticks, however small, are a hopeful sign.

Zillow.com also shows two Charlestown listings for year-round rentals after several months of showing zero.

Another piece of good news is that for the first time this year, Charlestown Town Clerk Amy Weinreich reports that there were no new foreclosures in Charlestown. That's genuinely worth celebrating. I sure hope that lasts.

If you search for homes priced in the affordable range – two bedrooms, under $225,000 – Zillow lists 25, most of them condos.

On the downside, more Charlestown homeowners have slid underwater, where they owe more than they have in equity, since my last report. In June, I reported that 15% of Charlestown homeowners were underwater. That’s gone up by 2%, to 17%.

South Kingstown and Westerly are at 15% each, while northern Rhode Island (Providence County) is at a shocking 37%, with Providence itself at just under 30%.

It’s hard to do much with the housing market while the Rhode Island jobs picture looks so bleak. We are starting to see some modest improvements in the official jobless rate, though unemployment remains too damned high.

But the official rate doesn’t accurately reflect the “real” unemployment rate, which includes the many more workers who are underemployed (not able to find steady, full-time work). Conspicuous among them are construction workers.

According to CNBC, Rhode Island’s “real unemployment” rate was 8.3% but after this Recession, the current rate is 18.3%.

Another metric that factors into the real estate outlook is the level of consumer optimism. In a recently released Gallup poll, Rhode Island ranked #24, right around the same level as Connecticut and Massachusetts.

Gallup uses an index to measure confidence and, on that scale, 53.2% believe Rhode Island is thriving and are optimistic about the future. On that index, Hawaii ranked first, followed by Utah. The only New England state to make the top ten is New Hampshire in sixth place. Maine ranked #49.

Whether you yourself feel Rhode Island is “thriving” is your opinion, but economists pay close attention to how people feel about the economy because that often drives spending. Downward recessionary spirals are often fed by consumer pessimism.