Matthew Espeut works on the first floor of the three-family house.

The Providence Journal / Mary Murphy

Matthew Espeut grew up in Providence’s Elmhurst neighborhood, where his father runs a flower shop, Frey Florist, on Radcliffe Avenue. Today Espeut, 39, is a real estate agent who has also made a career of flipping properties. His latest project, a condo conversion, is on the same street as his father’s shop.

Espeut bought the three-family for $280,000 last June, and after months of renovation work, he is planning to sell the building as three separate condominium units.

He said his aim has been to provide East Side style at an affordable price, and the condos, with wood floors, air conditioning, laundry hookups, sophisticated lighting and granite kitchen counters, will be priced under $220,000 ($199,900 for the third floor; $219,900 for the first and second floors). A few streets away, on Huxley Avenue, a new single-family house is on the market for $329,900.

The Radcliffe Avenue units are some of the newest entries in Providence’s inventory of condos for sale. Many of these units are conversions of smaller multifamily properties.

Although new construction of luxury, high-rise condos downtown is noticeable and high-profile, real estate agents say the quiet, building-by-building conversion of many small multifamily houses into condo units has also had a big effect on the Providence market in recent years.

There were 1,720 condominiums on the market in Rhode Island this month, 294 of them in Providence (including the East Side) alone. Last year, 1,883 condos were sold in Rhode Island, down from a high of 2,251 in 2005, but still up from the 1,759 condos sold in 2004.

Anne Giardina, an agent with Bayside Realty in Edgewood (Cranston), said the Edgewood and Pawtuxet neighborhoods have seen their share of condo conversions in the past three or four years, and she has been involved in many such transactions. “You can’t escape it,” she said.

“There are a number of young professionals who want to stay in the 200 range and want life to be simple, and in the housing market there are extremely limited options … so those are definitely the majority of the buyers for the condo market,” she said.

In addition to the need of young, first-time buyers for residences priced “in the 200s,” Giardina said the condo conversion trend has been driven by the high cost of buying and maintaining multifamily properties. “The houses are just too old,” she said. “You can’t buy them and just rent them out.”

To buy a typical older multifamily house in an established neighborhood at today’s prices, then completely renovate it — with a new roof, windows, plumbing and electrical systems, and new kitchens and bathrooms — is such an expensive proposition, that “the only thing that makes any kind of monetary sense … is exactly what has been going on,” Giardina said.

The rents that a landlord could command in this scenario would not come close to meeting his or her expenses, she said. “There is no more investment market in a residential neighborhood, basically,” she said.

Giardina said most of the landlords she knows in the Edgewood and Pawtuxet neighborhoods have owned their properties for at least 20 years; and even in the case of owner-occupied buildings, many owners are making little, if any, profit, Giardina said.

The cost of maintaining condo properties after the purchase is one reason Rhode Island Housing will not make loans for condominiums in associations that have less than four units.

“Many of those properties were not designed to be condos,” said Cathleen Paniccia, director of home ownership at the state agency. Unexpected maintenance costs could be high if not spread out among a larger owner base, she said, and could wreak havoc with the budgets of the low- and middle-income buyers the agency assists. “The condo conversion may not be as safe as a larger condo [association],” Paniccia said.

One East Side real estate agent who has sold a number of condo conversion units agreed. “You don’t have the [professional] management if you don’t have eight or nine units,” she said. “You’re going to be fighting with your neighbors about when to do the roof.”

“I think we need more rental properties,” she said. “Rentals are affordable.”

Thomas E. Deller, director of the Department of Planning and Development for the City of Providence, said the city does not track the number of condo conversions that take place each year.

Generally, conversions have not seemed to put a squeeze on the rental market, he said. But “we are concerned about rental units, because it’s one of the ways for low-income families to have a decent place to live,” he said. “I do get concerned about small-time condos, whether or not there’s enough of a maintenance fee,” he added.

“All roads to home ownership are well and good,” said Ari Matusiak, director of HousingWorks RI, but he added that Rhode Island needs “a healthy rental market.” Matusiak said the rental market is still “staggeringly expensive,” and despite reports that housing prices have declined, “prices are not falling in any real way. … If there are any reductions, they are nominal.”

“We are still facing a market that is not very friendly to the average worker,” he said.

Molly Keenan, of North Kingstown, who grew up in Providence’s Fox Point neighborhood, bought a three-family house at 53 Governor St. in Fox Point as a “family project” after she and her husband retired. They completely renovated the 1900 building and have sold two of the three resulting condo units. The first- and second-floor condos, which had asking prices of $379,900, have already sold. The top floor, priced at $339,900, is still on the market. Keenan said one of the sold units is used as a “pied-À-terre” by an executive at Fidelity Investments in downtown Providence who has a primary residence in North Andover, Mass., near the New Hampshire border.

Keenan said she recently decided to include the furnishings used to “stage” the top-floor unit in the selling price. “It’s always more challenging to sell the third floor,” she said. There is no elevator in the building, and the top floor unit is a former attic space.

Chris Keller, who works in the finance department of a Boston television station, purchased the second-floor unit in Thistle House, Keenan’s Fox Point conversion project, in October. She said she had been renting in Boston’s Back Bay neighborhood for six years before deciding to buy her own place. Even at $361,000, the price for her condo is a bargain compared to the Boston real estate market, Keller said. Keller once owned a co-op in New York City, so it’s not her first purchase, and it was important to her to be in an urban location. “I wanted to stay in the city,” she said.

Keller said because the entire building has been completely renovated, she’s not worried about excessive maintenance costs, and she was attracted to the combination of old-house charm and updated elegance in her condo. “I couldn’t believe it was their first conversion project,” she said of the Keenans.

Keller, who is single, wanted a second bedroom, but was not interested in buying a single-family house. “I don’t need a huge house to take care of,” she said.

cdunn@projo.com