Chafee's house at 54 Barnes St.

Bill McBride, who writes the must-read economics blog Calculated Risk, has been keeping an eye on Governor Chafee’s (thus far unsuccessful) efforts to unload the Providence house he and has wife bought in 2006.

As I reported yesterday, the Chafees have reduced the price twice since putting the home on the market in mid-February – it’s now listed for $799,000. McBride, who knows the housing market better than just about anybody, thinks they’re getting closer to what the market will bear:

When this house was first listed, I argued we’d see a price reduction. Although Case-Shiller doesn’t track Providence, house prices have fallen about 15% in Boston and 23% in New York – and that would suggest a selling price in the $700s for the Chafees’ home. So many homeowners are unwilling to price their homes realistically – at least the Chafees have been willing to reduce the price.

One of McBride’s commenters noted that the house has an appraised value of $801,200, so the Chafees are only now asking for what the city says it’s worth. Meanwhile, another commenter questions whether the local property market should be compared with those in Boston and New York:

I don’t know much about Boston’s real estate market. But why would you compare the real estate markets in Providence and New York? The economic base, job scene, inventory, relocation market, etc. is totally different. Providence once was one of America’s great manufacturing towns. Now, all it has left is government and education.

Providence has more in common with Detroit or Cleveland.

Detroit?!