First-time homebuyers in Rhode Island are systematically losing to investors and cash buyers – not because they lack resources, but because they’re pursuing the wrong strategy entirely, according to one industry professional who’s witnessed the competitive dynamics firsthand.
Walt Buteau, a real estate advisor at Engel & Völkers Oceanside, argues that the conventional wisdom about homebuying – seeking move-in ready properties – has become a liability in today’s market conditions.
The Turnkey Trap
Many first-time buyers come into the market expecting a turnkey home—something “perfect” and move-in ready, Buteau says. But because everyone wants those properties, they sell quickly and attract the highest competition.
According to Buteau, this preference creates a fundamental mismatch between first-time buyer expectations and market realities. When everyone targets the same “perfect” properties, first-time buyers find themselves competing against more aggressive purchasers who can offer superior terms.
The Competitive Disadvantage
Buteau says first-time buyers often face competitors who can offer stronger terms. Buyers with limited cash typically need inspections and protective contingencies, while others with more resources may “put more money down” and even waive inspections. That willingness to take on more risk makes them far more appealing to sellers.
This dynamic, he says, makes first-time buyers inherently less attractive to sellers, regardless of their financing qualifications or earnest money deposits.
The Strategic Flip
Buteau urges buyers to abandon the usual strategy altogether. Rather than chasing fresh listings, he advises clients to “flip the search upside down” and target homes that have sat on the market for 30–40 days, properties that may be overpriced or need work, but come with far less competition.
This approach, according to Buteau, identifies properties that may have been overpriced initially or require work—exactly the opportunities that turnkey-focused buyers typically avoid.
Real-World Success Stories
Buteau points to clients who have succeeded precisely because they were willing to take on homes that needed work. He says he has guided several buyers who initially resisted fixer-uppers through the renovation process—helping them find contractors and even lending them tools when needed.
He recalls two buyers in particular who purchased homes in very poor condition but secured them at strong prices. After putting in the necessary work, both now feel satisfied with their purchases and have built meaningful equity as a result.
Alternative Entry Points
Beyond fixer-uppers, Buteau highlights smaller multifamily properties as an underused entry point. He notes that most investors target larger three-unit buildings with multiple bedrooms – inventory that is scarce. As a result, he encourages first-time buyers to look instead at two-unit buildings with more modest layouts, which often face far less competition. He points to one such property he’s currently listing for about $400,000, calling it an ideal starter home for a young couple or single buyer.
The Condo Alternative
Buteau also advocates for condominiums as an entry point, particularly for buyers like a Coast Guard member he’s currently working with. “I really think they should be open to condos. First time home buyers,” he says, viewing condos as a way to avoid the intense competition for single-family homes.
The Equity Building Argument
Central to Buteau’s strategy is the long-term wealth-building potential of non-turnkey purchases. “First time home buyers should be more open to looking for that house that needs work, because that’s where you’re going to make money and have equity in a market like this,” he argues.
This approach, he suggests, allows buyers to build equity through improvements rather than competing for properties where equity gains depend entirely on market appreciation.
Market Timing Considerations
Buteau’s recommendations come at a time when he observes that “prices definitely are definitely leveled in many communities and are starting to go down a little bit.” This environment, he suggests, makes the fixer-upper strategy even more compelling, as buyers can potentially acquire properties below peak pricing while adding value through improvements.
Redefining Success
For Buteau, successful first-time homebuying in Rhode Island’s current market requires abandoning the pursuit of perfection. His approach emphasizes strategic patience, willingness to take on projects, and recognition that the best opportunities often come disguised as properties other buyers have overlooked.
Whether first-time buyers embrace this contrarian approach may determine their success in a market where traditional strategies increasingly lead to disappointment.
