Maine home sales and prices continued to climb in January, signaling that the typical winter slowdown in real estate activity isn’t happening after a record-breaking year for the state’s housing market.
Sales of existing single-family homes in Maine jumped 18.4 percent in January compared with January 2020, a month in which sales and prices were robust compared to typical winters. A low inventory this year helped push the median home sales price up 15.6 percent over last year, to a median of $255,300. The median indicates that half of homes sold for more money and half sold for less.
Aaron Bolster of Allied Realty in Skowhegan, who is this year’s president of the Maine Association of Realtors, said the inventory of homes for sale is “historically low” coming into 2021 after the record-setting year for sales last year. With demand high, fueled in part by out-of-state buyers moving to Maine, houses that went on the market sold quickly, and prices rose.
For the three-month period ending Jan. 31, sales increases in January ranged from a 9.3 percent jump in Cumberland County to an increase of 82.1 percent in Piscataquis County, where home sales nearly doubled to 122 for the three-month period from 67 a year earlier. In Cumberland County, 1,016 homes changed hands during the three-month period, compared with 930 a year earlier.
Median home prices rose in all 16 counties in Maine for the three-month period, with Aroostook County’s median the lowest in the state at $103,000, and Cumberland County’s the highest at $373,250. Lincoln County posted the largest percent increase in median home price, rising 47 percent for the three-month period compared with a year earlier, and Washington County had the smallest increase at 5.1 percent.
But for all the news about increasing sales and rising prices, there are worrisome signs for the Maine housing market, Bolster said, and a key period just ahead.
Spring is usually prime season for real estate, Bolster said, when many people decide to put their homes on the market. If it’s a normal year and a lot of homes are put up for sale, that will help ease the tight inventory issue, but that didn’t happen last year, he said.
“Last spring, with the pandemic just beginning, we missed out,” Bolster said, and people either pulled their homes from the market or shelved plans to put them up for sale. Real estate sales in the state plunged for a couple of months before staging a strong recovery in the summer and fall, but the inventory issue lingered, particularly with the rising interest in Maine homes by out-of-state buyers.
Those buyers currently account for more than 30 percent of the sales, he said, up sharply from pre-pandemic days when they made up about 20 percent of the market.
If more homes aren’t offered for sale, Bolster said, “it becomes unhealthy … and it could be a challenging year in real estate sales.”
Another sign of the unusual market is rising sales of buildable land, he said. However, with the cost of building materials rising, Bolster said he’s worried that those land buyers might not be able to follow through on plans to build.
The picture many may have is of a real estate market in which the agents are happily churning deals, Bolster said, but that might change as the year goes on.
“We definitely have some challenges here,” he said.
Nationwide, sales were even more brisk than they were in Maine and prices also rose in January. The National Association of Realtors said sales of existing single-family homes rose 23 percent in January, compared with the same month a year ago. Prices rose by nearly 15 percent to a median of $308,300.
In the Northeast, the association said, sales increased by 24.3 percent, and the median sales price rose 15.8 percent to $361,400 in January, compared with the same month in 2020.
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