Housing This section of the BDN aims to help readers understand Maine’s housing crisis, the volatile real estate market and the public policy behind them. Read more Housing coverage here.
Stacey Souza’s most popular listing is a 4-bedroom farmhouse in the rural, coastal town of Friendship.
That’s because it’s listed for $250,000. Many people, notably first-time home buyers, are desperate for anything in that price range, even though the home needs a lot of work and will not be eligible for traditional financing.
The median sale price of a single-family home in Maine currently sits at $408,500, but that sum is far out of reach for the average household in Maine, which makes an annual income of just over $68,000, according to census data. That can afford you a home up to $254,000 with a $20,000 down payment, according to Zillow’s affordability calculator.
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But home prices haven’t been that low statewide in Maine since July 2020, according to Maine listing data. They’re unlikely to return there any time soon, even in the more rural parts of the state that agents once had to urge their clients to reconsider.
“This is the new normal,” Souza, an associate broker with Rockland-based Cates Real Estate, said. “Everything that we hear from economists and real estate forecasters is that prices are not going to go back down.”
That leaves the average Mainer searching for homes in a tight spot. In southern Maine, $250,000 nets you a 650-square-foot condo, a seasonal cabin, a mobile home or just some land. In Aroostook, it can net you a charming 3-bedroom home in Madawaska’s town center.
Homes are costlier in the Portland area and along the coast. Yet buyers have been able to scoop up bargains over the last few years in central Maine, where homes were generally affordable to the average family until COVID-era price increases. In 2019, you could still find a turnkey home in the Augusta-Waterville area for $160,000.
“Now if you’re paying $160,000, it’s probably a mobile home on an acre of land,” Tim Fortin, the designated broker of NextHome Northern Lights Realty based in central Maine, said.
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Fortin also has a 5-bedroom home on the market going for $250,000 in Fairfield. Like Souza’s, it is typical of those priced around this point in Maine: inland and in need of renovations.
This 5 bedroom Victorian home in Fairfield is priced at $250,000, making it a rare commodity in Maine’s real estate market. Credit: Tim Fortin / NextHome Northern Lights Realty
It is a classic 1900s Victorian style build with lots of character, including original woodwork and stained glass windows. Though some renovations were done by a previous owner, more are needed. The floors need sanding and coats of polyurethane. The second floor is unfinished.
Like Souza’s listing, Fortin said this home is sitting on the market because the average person can afford to buy the home but not to fix it up.
“People are looking for more of a finished product,” Fortin said. “I think that’s hard to find in today’s market, unless you’re willing to pay $400,000.”
Because the cost of a single family home continues to climb, even in rural parts of the state, buyers keep having to make concessions. Condition of the home is one, Souza said. Typical buyers are looking at homes that need some cosmetic upgrades. People are also more willing to take a longer commute to work for the price they want, she said.
“People are willing to give up more of the things that they thought would be really important to them, especially for first time homebuyers,” Souza said. “Once they start to see a few homes in their price range there … certain things fall off their list.”
CAMDEN — We knew all along how excellent The Place bakery is, at the top of the hill in Camden. That is why folks line up outside waiting for the doors to open.
But the New York Times also figured out how special The Place is, and in a Dec. 24 article, 22 of the Best Bakeries Across the U.S. Right Now,included the Camden bakery, lauding its, “ethereally flaky croissant dough (made with local flour and butter)….”
The Place, tucked off of Route 1 at 117 Elm Street, Camden, has plenty more going for it, thanks to its owners, Chelsea Kravitz and Chris Dawson, who are community-minded and always giving. They opened their enterprise in Summer 2023, and were instantly appreciated.
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Congratulations for making the national scene! Lear more on Instagram.
Mainers consider the housing crisis to be a bigger problem than any of the others facing our state.
The lack of housing inventory at all income levels, which was caused by historic underproduction and higher migration rates, has sent home prices soaring in recent years. It is harming Maine businesses and shutting many out of the housing market entirely.
Average home values and median home prices increased more in Maine in the last year than they did nationally. Other northeastern states have seen bigger hikes. But other metrics show that the crisis is virtually as bad here than anywhere else nearby, especially when you account for the fact that incomes are lower in Maine than in any other state in the region.
Here are three datapoints putting Maine’s housing crisis into perspective.
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Sale prices are growing nearly as fast here as anywhere in New England.
Median home sale prices are growing nearly as fast in Maine as they are in any other northeastern state. Regionally, they’ve increased by anywhere from 5.9 to 11.3 percent in the last year. Maine is riding the middle at 8.2 percent, higher than any New England state besides Rhode Island, according to Redfin.
To purchase the median home for sale in Maine right now, you need an income of just under $112,000 a year, assuming no debts and a $20,000 down payment, according to Zillow’s affordability calculator. The median household income here is a little under $72,000, according to census data. That shows how out of whack the housing economy is for the average person.
Home values in Portland are growing as fast as they are in Boston.
Over the past year, there have been signs that Portland’s red-hot pandemic housing market is slowing down. But that’s all relative. Home values here still grew by 3.8 percent over the past year as of November, which was only slightly below Boston at 4 percent, according to Zillow.
But when stacked up against the other largest cities in each New England state, Portland is second only to Burlington in seeing the lowest increase in home values in the past year. Providence, Rhode Island, has seen the largest hike, followed by Bridgeport, Connecticut.
Both those cities are facing major shortages and price increases, although they are still far cheaper markets to buy in than Portland. The typical home value in Providence is just over $400,000, which is roughly in line with Maine’s statewide average.
Maine’s rental crisis is worse than in this nearby Canadian city.
The southern Quebec city of Sherbrooke — only 40 miles from Maine’s western border — is in the midst of an “unprecedented housing crisis,” according to a local news outlet.
The city had a vacancy rate of only about 1 percent in October and 25 percent of households are spending more than 30 percent of their income on rent. Here in Maine, that latter figure is far worse.
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Nearly half of all renters in both Bangor and the Portland-South Portland area are spending at least 30 percent of their income on housing, data from Harvard University found. Roughly 45 percent of renting households in those areas pay over 30 percent of their income on housing, and 24 percent pay more than 50 percent.
As in Sherbrooke, officials here attribute the crisis to a low vacancy rate, a lack of affordable housing supply and the high cost to construct new units. The reasons for the crisis are clear everywhere, but the solutions are coming slowly.
State police are searching for a 41-year-old man they say strangled his pregnant partner.
Dusty O’Brien is wanted for domestic violence aggravated assault, reckless conduct and violating conditions of release, state police said Wednesday. He is out on bail for a separate domestic violence arrest, according to police.
Police say O’Brien strangled his pregnant partner on Tuesday and fled his residence before police arrived.
He is known to frequent the Porter area and other parts of Oxford County.
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