Would You Let $80 a Month Hold You Back from Buying a Home?

After several years of high mortgage rates and hesitation from buyers, momentum is quietly building beneath the surface of the Rhode Island housing market. Sellers are reappearing. Buyers are re-engaging. And for the first time in what feels like forever, there's movement happening again across Rhode Island and New England.

No, it's not a surge. But it is a shift – and it's one that could set the stage for a stronger year in 2026 for those looking to buy a house in RI or sell a house in RI.

So, what's driving the comeback? Here are three big trends that are slowly breathing life back into the Rhode Island housing market right now.

1. Mortgage Rates Have Been Coming Down in Rhode Island

Mortgage rates are always going to have their ups and downs – that's just how rates work. Especially with the general economic uncertainty right now, some volatility is to be expected. But, if you zoom out, it's the larger trend that really matters most for Rhode Island home buyers.

And overall, rates have been trending down for most of this year (see graph below):

And in just the last few months, we've seen the best rates of 2025. According to Sam Khater, Chief Economist at Freddie Mac:

"On a median-priced home, this could allow a homebuyer to save thousands annually compared to earlier this year, showing that affordability is slowly improving."

Here's why that matters for you when you buy a house in RI. This shift changes what you can actually afford. It means lower borrowing costs and more buying power for Rhode Island home buyers. Take this as an example.

Data from Redfin shows a buyer with a $3,000 monthly budget can now afford roughly $25,000 more home than they could one year ago. That's a big deal for first-time home buyers in Rhode Island. And it's just one of the reasons why activity is picking up across Providence, Warwick, Cranston, and throughout Rhode Island.

2. More Rhode Island Homeowners Are Ready To Sell

For a while, many Rhode Island homeowners stayed put because they didn't want to give up their low mortgage rate. That "lock-in effect" kept inventory tight across Providence real estate, Warwick homes for sale, and throughout Rhode Island. And while plenty of homeowners are still staying where they are today, the number of rate-locked homeowners is starting to ease as rates come down. Life changes are becoming a bigger part of what's driving more people to sell a house in RI, and that's opening up more inventory.

Data from Realtor.com shows just how much the number of homes for sale has grown in Rhode Island. And the really interesting part is that the Rhode Island housing market is approaching inventory levels that haven't been seen for the past six years (see the blue on the graph below):

That return to more normal inventory levels is a really good thing for Rhode Island buyers. It gives buyers more options than they've had in years across Providence homes for sale, Newport properties, and throughout New England. And it's helping to bring the Rhode Island real estate market closer to balance.

3. More Rhode Island Buyers Are Re-Entering the Market

And it's not just Rhode Island sellers making moves. With more options and slightly better affordability, buyers are getting back in the game when they buy a house in RI, too. The Mortgage Bankers Association (MBA) reports purchase applications are up compared to last year, a clear signal that demand is building again for homes for sale in Rhode Island (see graph below):

And real estate experts think this momentum will continue across Rhode Island and New England. Economists from Fannie Mae, the Mortgage Bankers Association (MBA), and the National Association of Realtors (NAR) all forecast moderate sales growth going into 2026 for the Rhode Island housing market.

Now, this recovery won't happen overnight. It's not a flood of activity. But it is the start of steady improvement going into 2026 for the Rhode Island real estate market. And that's something a lot of people looking to buy a house in RI or sell a house in RI have been waiting for.

Bottom Line

After several slower-than-normal years, the Rhode Island market is finally starting to turn a corner. Declining mortgage rates, more listings, and growing buyer activity all point to a market gaining real traction across Providence, Warwick, Cranston, Newport, and throughout Rhode Island.

Let's connect to talk about what's happening in our local Rhode Island market and how you can make the most of it in 2026 whether you want to buy a house in RI or sell a house in RI.

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