Before entering any real estate market, whether it's the Scarborough real estate market you've lived in for years or a brand new one in a different city, you need to research the facts and trends of the market. Why? Because even markets you think you're familiar with will have changed in the years since you bought your last home. To illustrate our point and give you some much needed information at the same time, we've created this overview of the market conditions in Providence, Rhode Island, for the past, present, and future.

Several years ago in 2007 the housing market in Providence was doing well without being so expensive as to exclude large segments of the population. The median house or condo value was $268,000, which was slightly less than the Rhode Island average of $292,000 and up more than double from its value in the year 2000. At this time, a condo in Rhode Island was comparable in value to Liberty Village condos in Toronto, the average one costing around $350,000. Detached single family homes were actually slightly cheaper, at $338,000 and town homes more expensive at $407,000.

Then, as we're sure you know, came the sub-prime mortgage crisis and the recession, which dropped housing values all over North America. Meadowvale homes in Toronto suddenly became more affordable and so did Providence real estate. In fact, the housing values are still trending downward in Providence, with the median sale price having declined more than 30% since last year and the number of homes being sold dropping by 22% as people decided to try and wait out the recession before selling.

This has created a buyer's market in Providence at the present time. With more homes than buyers, sellers find themselves accepting lower prices for their property, perhaps even registering a loss compared with what they got for their old Lagrange, NY homes before they moved to Rhode Island. The current average listing price is around $312,000 and the median sales price is about $101,000, creating a price per square foot of $73. Breaking the averages down to the neighborhood level, we see average listing prices for the most popular neighborhoods are in the $181,000 to $484,000 range.

While we don't have a crystal ball, there are certain conclusions we can draw based upon our knowledge of past trends and current events. Within the next year or so, the value drop should level off and begin to reverse itself as economic stimulus measures start to take effect and trickle down into the housing market. While Providence houses should go back to being more expensive than an Ajax house for sale, they probably won't reach their former pre-crisis heights because the sub-prime bubble has burst.