The Case for Shopping Stale Listings in a Competitive Starter-Home Market

Written by:

Rudi Davis

Date:

10 Dec 2025

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First-time homebuyers in Rhode Island are struggling to compete for move-in-ready properties, but there are alternatives for those willing to adjust their expectations, according to Walt Buteau, a real estate advisor at Engel & Völkers Oceanside. Limited inventory under $500,000 and widespread demand for turnkey homes have created a market where entry-level buyers routinely lose out to those with more cash and greater flexibility.

Buteau says most first-time buyers want turnkey homes, which fuels intense competition for those properties. Buyers with smaller down payments often need inspections and stricter contingencies, while competing buyers can offer larger deposits and waive inspections. As he puts it, “those houses go quick,” and buyers with fewer financial advantages are frequently outmatched.

This dynamic means first-time buyers with smaller down payments and stricter loan requirements are routinely outbid by buyers who can offer larger deposits, fewer contingencies, and faster closings. Sellers, unsurprisingly, prefer buyers with more financial flexibility. But Buteau says this has created a market where the real shortage is not affordable housing itself, but affordable housing that fits the move-in-ready ideal.

The Inverted Search Strategy

To address this, Buteau urges first-time buyers to rethink their search strategy. Instead of chasing new listings, he advises them to “flip the search upside down” and focus on homes that have been on the market for 30 or 40 days. These properties often sat because they were initially overpriced or need updates, he says, and can offer better value for buyers willing to take on some work.

Most first-time buyers chase new listings, hoping to find a hidden gem before competition heats up. But Buteau argues that in the current market, this is a losing strategy. Properties that linger for 30 to 40 days have often been overlooked because they need work, were initially overpriced, or have issues that can be fixed. These homes present real opportunities for buyers who are willing to take on some improvements.

Buteau emphasizes that these overlooked properties can be solid investments. Homes needing a kitchen renovation or cosmetic updates attract fewer bidders, giving buyers more negotiating leverage. Properties that were overpriced and reduced after weeks on the market may now be below the value of similar, better-conditioned homes.

Buteau says several clients have succeeded with this approach. He has helped buyers through the renovation process – connecting them with contractors and even lending tools. Two recent clients bought severely rundown homes at strong prices, he says, and after investing in improvements, “they still have equity” and are happy with the outcome.

The Financial Logic of Fixer-Uppers

The financial benefit of buying properties that need work is clear. For example, a buyer who purchases a distressed home for $350,000, invests $50,000 in improvements, and ends up with a property worth $450,000, builds equity more efficiently than someone who simply pays $450,000 for a move-in-ready equivalent. The first buyer has $50,000 in equity (minus renovation costs), while the second buyer pays a premium for convenience and gains no immediate equity.

Buteau argues that first-time buyers should be more willing to consider homes that need work, calling fixer-uppers “where you can make money and have equity” in today’s market. Still, he notes that many buyers hesitate, drawn to turnkey homes even though that preference now carries a much higher price.

Buteau’s support for buyers extends beyond identifying fixer-uppers. He helps clients navigate the renovation process, connects them with contractors, and sometimes even provides tools. This hands-on approach addresses the concern many first-time buyers have: that they lack the knowledge or resources to manage renovations.

Alternative Property Types Worth Considering

Buteau also urges first-time buyers to broaden the types of properties they consider. Condos, he says, often offer a more affordable entry point than single-family homes. He likewise recommends small multifamilies, such as two-unit buildings with two bedrooms each, noting that these can be strong starter-home options. He points to one he’s currently selling for about $400,000, calling it “a great first-time home” for a young couple or single buyer.

Owning a small multifamily property allows a buyer to live in one unit and rent out the other, generating income to help cover the mortgage while building equity. This approach provides more financial flexibility than a single-family home, especially for buyers stretching their budgets to make a first purchase.

The Market Reality for Move-In-Ready Homes

Buteau says these alternative strategies are necessary because competition for move-in-ready homes under $500,000 is extremely intense. Well-priced, good-quality properties in that range “go very, very quickly,” he says, and there simply aren’t many true starter homes of that type available in Rhode Island.

This scarcity means that first-time buyers will continue to be edged out by those with more resources unless they change their approach. With limited move-in-ready inventory and high demand, buyers who insist on perfect homes will face repeated disappointment. Buteau’s strategy is to help first-time buyers compete where they have an advantage: in properties that need work, have lingered on the market, or fall outside the conventional single-family mold.

By shifting focus to overlooked listings, guiding buyers through renovations, and considering condos and small multifamilies, agents can help first-time buyers find opportunities and build equity in a difficult market. This approach requires buyers to move beyond the emotional appeal of a turnkey home and focus on long-term financial benefits.

Whether this strategy becomes more common in Rhode Island will depend on how many first-time buyers are willing to prioritize financial opportunity over immediate convenience. Those who do will have more options and a better chance at building wealth. Those who do not may find themselves priced out entirely as competition for move-in-ready homes continues to favor buyers with greater financial leverage.