Real Estate

Rhode Island Housing Market: Is the Seller’s Reign Ending? Prices Still High, But Signs of Change Emerge

Rhode Island home prices rose 10% YoY, but rising inventory hints at a cooling market.

October 31, 2025, 4:03 PM

High-resolution drone photo of The Breakers mansion and other luxurious properties on the rocky coastline of Newport, Rhode Island.

High-resolution aerial photo of ocean mansion properties along the beautiful Newport, Rhode Island coastline. By johnstonsam / Shutterstock.com.

Executive Summary

Rhode Island’s median home price rose 10.8% year-over-year to $569,700 in September 2025, with Newport seeing an 80.5% increase.

Housing inventory in Rhode Island increased by 10.1% year-over-year to 3,522 homes for sale in September 2025, indicating an initial loosening of supply.

The market is showing softening signals, with a 7.7 percentage point decline in homes selling above list price, suggesting less intense competition and more room for buyer negotiation.

The Trajectory So Far

Rhode Island’s housing market has experienced sustained, significant year-over-year median home price increases, driven by years of ultra-low supply and high demand; however, recent data for September 2025 shows an uptick in inventory, signaling a potential softening of the purely seller-driven environment.

Assessing Risk and Value

While Rhode Island’s housing market continues to exhibit strong price appreciation, especially in high-demand coastal areas like Newport, investors should recognize the emerging softening signals, including increased inventory and a decline in homes selling above list price. This nuanced shift suggests that while core market strength persists, adapting to more creative or niche investment strategies, such as furnished rentals, multi-family units, or value-add properties, could prove more advantageous for mitigating risk and optimizing returns in this evolving landscape.

Expert Predictions and Forecasts

The Rhode Island housing market remains largely seller-favorable, with median home prices continuing to show strong year-over-year growth, particularly in high-demand coastal areas like Newport.

Signals indicate a gradual softening of market conditions, with an uptick in inventory and a decline in homes selling above list price, suggesting increased negotiation opportunities and flexibility for buyers.

Rhode Island’s housing market continues to show strong price momentum, with median home prices climbing over 10% year-over-year, yet new data for September 2025 indicates softening signals for both sellers and buyers. While the market remains dynamic, an uptick in inventory suggests that the long-standing grip of a purely seller-driven environment may be beginning to loosen across the Ocean State.

According to the latest data from Redfin, the median sale price for all home types in Rhode Island reached $569,700 in September 2025, marking a 10.8% increase compared to the previous year. Notably, the city of Newport experienced a significant surge, posting an 80.5% gain, reflecting sustained high demand in its coastal areas.

Inventory levels are showing initial signs of growth, a crucial development after years of ultra-low supply. In September 2025, there were 3,522 homes for sale in Rhode Island, representing a 10.1% increase year-over-year, as reported by Redfin.

Despite this increase, the months of supply remains at two months, indicating that while conditions are easing, it is far from a buyer’s market. Additionally, the percentage of homes selling above list price declined by 7.7 percentage points year-over-year to approximately 41.7%, suggesting fewer multiple offers and slightly more room for buyer negotiation.

Earlier in 2025, reports from the Real Estate Institute of Rhode Island and the Rhode Island Association of REALTORS® (RIAR) noted a less extreme imbalance between supply and demand. For the first quarter of 2025, RIAR reported a median sale price of $465,000, a 5.7% year-over-year increase, even as single-family home sales volume saw a slight dip.

Market Implications

For sellers, robust prices continue to be an advantage, but overpricing or delaying a listing might reduce competitiveness as buyer urgency slightly wanes. Strategic pricing is becoming increasingly important in this evolving landscape.

Buyers still face a relatively tight market, but the emerging signs of cooling could offer more time for property tours, contingency considerations, and negotiation opportunities. This is particularly true in non-coastal or less prominent towns.

Investors will find coastal markets, such as Newport, remain high-demand and high-priced. The shifting market dynamics may favor more creative or niche investment strategies, including furnished rentals, multi-family units, or value-add properties.

Outlook

The Rhode Island real estate market continues to be decidedly seller-favourable, but the period of intense competition is gradually narrowing. Buyers may now find a bit more flexibility, while sellers are encouraged to approach the market with both optimism and a well-defined strategy.