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Markets in Greater Portland on the Rebound


By Kate Hodgson

Portland Head LightI have compiled the information in this report to help my clients stay informed about market trends and to help them make critical decisions while navigating the Greater Portland real estate market.  Data are gathered from records on the Maine Real Estate Information Service (MREIS) also known as the multiple listing service (MLS).  The report presents information from 1998 forward as records prior to that are less reliable

The information is consolidated into 4 categories based on market trends: 1. Portland and South Portland single family homes; 2. Cape Elizabeth, Falmouth, Scarborough and Yarmouth single family homes and condos; 3. Gorham, Gray, Westbrook and Windham single family homes and condos; and 4. Portland and South Portland condos.

Please note: for simplicity I will refer to the first quarter as Q1 and so on.

General trends in Q1 2012:

The big story of 2012 so far is the lack of inventory.  Sales are up and inventory is down but an increase in prices has not yet followed because of the continuing impact of distress sales on the market.


Interest rates are still low but leaning upwards and investors are trawling for opportunities with the increased confidence that a market recovery is underway.


Some areas of the country are reporting a shift to a sellers’ market.  Portland and South Portland show signs of moving in that direction and the ripple effect will start to show in the outlying areas.  Additionally, colleagues have been reporting on an increase in multiple offers.

There is still a high level of distressed property on the market keeping a price increase at bay but that will change if current trends continue.

The notable exception to this trend is the condo market where sales have slumped.

1. Sales:

Sales have increased in all the areas observed.

In Portland and South Portland the number of single family homes sold in Q1 rose to 112, up from 98 in 2011.

In Cape Elizabeth, Falmouth, Scarborough, and Yarmouth, the number of properties sold in Q1 climbed to 132 up from 105 last year and the highest level since 2007.

In Gorham, Gray, Westbrook and Windham, the number of properties sold stayed fairly close to the level in 2011 at 119 units sold.



2. Inventory:

While sales have gone up, inventory has gone down; creating the best ratio between the two that we have seen in 5 years or more.

In Portland and South Portland the ratio dropped to 1.73 new listings for every property sold, down from 2.04 in 2011, and almost matching the 15 year average.

In Cape Elizabeth, Falmouth, Scarborough and Yarmouth there were 1.91 new listings for every property sold, down substantially from 2.41 in Q1 2011, below the 15 year average, and the best ratio since 2005.

In Gorham, Gray, Westbrook, and Windham the ratio was 2.14 new listings for every property sold in Q1 2012, down from 2.28 last year but above the 15 year average.



3. Prices:

Sales are up, inventory is down, but an increase in prices has not yet followed.

In Portland and South Portland the average sale price declined 7% from the previous year.

In Cape Elizabeth, Falmouth, Scarborough and Yarmouth the average sale price remained largely unchanged.

In Gorham, Gray, Westbrook and Windham the average sale price also remained unchanged from last year.

Foreclosures and short sales are still keeping prices from gaining traction.  Many pundits have predicted an increase in prices by the end of this year or into 2013.

4. Days on Market (DOM):

The number of days it is taking a property to sell has remained high, again a reflection of the number of short sales on the market and the length of time they take to work through the system.

For example, of the 34 properties identified as distressed sales that sold in the first quarter of 2012 (9% of the market), the average Days on Market was 155, significantly higher than the average for all other sales at 115.  It is also worth noting that distress sales sold for an average of 89% of the list price at time of sale, 84% of the original list price.

Condos (Portland and South Portland):

The condo market in greater Portland. .bucking all the favorable trends: sales are down, inventory is up, and the average sales price continues to swing rather dramatically.


In Q1 2012 the number of sales dropped slightly from 51 in Q1 2011 to 45 in Q1 2012 and the number of new listings rose slightly from 114 to 119.  The average sale price slumped from $259,040 to $199,652, down 30% from Q1 of last year.


As of April 8, 2012 there are 216 condos currently on the market in Portland and South Portland with 48 under contract, or 22% of inventory.

Multi-units (2-4 unit properties in Portland, South Portland, Westbrook):

Multi-units are following the favorable trend with a big drop in new listings, an increase in sales, and very low inventory.  There were 40 new listings in Q1 2012, down significantly from 67 in Q1 2011 and the lowest number in the last 15 years. The number of sales increased from 20 in Q1 2011 to 37 in Q1 in 2012.  This brought the ratio of new listings to units sold down to 1.08.


The average sale price increased 4% and the average price reduction was 95% of the list price at time of sale. The average Days on Market was 93.

As of April 8, 2012 there are 84 2-4 unit properties on the market in Portland, South Portland, and Westbrook, with 23 of those under contract, or 27% of current inventory.

Greater Portland 2011 Year in Review


By Kate Hodgson
So how did we fare in 2011? And where are we going in 2012?

The Greater Portland real estate market recorded the lowest number of sales in over 14 years in 2011. But the news is not all bad. The market continues to stabilize and as sales have declined so too has inventory. The ratio of new listings to properties sold has steadily decreased to 1.85 since a peak of 2.10 in 2008.  Despite the sluggish sales, 2011 ended in a strong position with noticeable improvement in the fourth quarter both locally and nationally.

The Greater Portland market saw an 8% increase in the number of single family homes and Portland condos sold in the fourth quarter from the same quarter last year.

This reflected the positive news being reported nationally.  According to a WSJ online 12/21/11 report, residential construction “surged in November, pushing housing starts to… the highest level in 19 months”. Additionally, the National Association of Realtors, reported that existing home sales rose in November.

As for 2012, the predictions swing in every direction.


Franklin American, in their electronic newsletter, summed up the outlook for 2012:

The New Year is here. Of course, now we are inundated with predictions regarding what will happen in the coming year. If you read 100 predictions, you would get 100 different scenarios. For example, in October Fannie Mae predicted that rates on home loans would fall in the first half of next year, while Freddie Mac forecasted an increase in rates. In addition, Fannie Mae Chief Economist Doug Duncan rated the chance of a recession at 40% next year while Freddie Mac predicts that economic growth will likely strengthen to about 2.5% in 2012. More recently, a survey of 20 top economists conducted by CNN/Money predicted the risk of a recession next year at only 20% next year. This survey expected the fourth quarter growth rate to be the strongest of the year with over a 3.0% growth rate, but grow to slow to an annual rate of 2.4% next year.


Slow growth next year but no new recession? Sounds like a replay of this year. Our advice? Don’t get lost in predictions. Most of the time they are a reflection of what already has happened. Right now we have very positive trends with increased consumer confidence confirmed by the Conference Board’s survey released last week… The real question is, will these trends continue into next year or do we fall back into our ‘starts and stops’ pattern of economic recovery? If you want a clue to that question, watch the employment trends.


Rising rents are forcing renters to outspend home owners on housing costs, according to a recent study. Since 2005, home owners’ housing expenses have climbed from 31.9 percent of their household budget to 33.2 percent. On the other hand, in that same time period, renters’ expenses have jumped from 35.6 percent to 38.4 percent, according to the October CoreLogic U.S. Housing Trends.  Source: RISMedia


The Greater Portland market:

Last year, Housingpredictor.com, an independent real estate news website, touted Portland as one of the top 3 markets for growth nationwide. Sadly, it doesn’t even make the top 25 this year. Their reasons:

“Extraordinarily sluggish home sales and slowly declining home prices are preventing Maine housing markets from making a full-fledged recovery, but cities and towns throughout the state are hardly experiencing a major drop in home values either.

Maine is turning out to be one of the safest bets so far in the fallout of the U.S. real estate collapse. A slim volume of sales is hand-cuffing the markets and are expected to chill the region’s home sales at a slow pace through 2012.

National headlines over the foreclosure crisis and falling home values have hurt Maine housing markets more than anything else. Housing sales in most of the state have been sluggish but have remained consistent through the U.S. downturn – just not many sales compared to most other regions of the country. Less than 1,000 homes sell in an average month statewide.

While sales move at a snails pace, the number of homes being sold monthly are creeping up as prices decline only marginally. However, home sales are projected to increase in Portland as new home buyers take advantage of record low mortgage interest rates. The influx of retirees to the region is also helping to boost the market. But home values are forecast to drop slight during the year averaging 2.6% less.”

On the other hand, CNN Money, which tracks 384 markets throughout the US, predicts a 4.5% increase in home prices for the Greater Portland market.

My own opinion is that 2012 will be much like 2011. Sales will continue to be sluggish until the end of the year. Distress sales will keep prices from gaining real traction although I predict they will appreciate slightly as buyers seize the opportunity of low interest rates and sense an end to the bottom of the market. Low interest rates will continue to fuel buyer interest although mortgages will remain bridled by strict lending practices.

Unless we hit a snag (i.e. consumer confidence lags, employment rate stalls, or we experience an environmental disaster), 2012 will remain slow but steady. However, with continued stabilization, we will start to see appreciable change in late 2012 or 2013.

3rd quarter housing results for greater Portland Maine

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Thanksgiving by FlickrHappy almost T-day!  As we enter the holiday season the greater Portland Maine real estate markets continue to show stability and resilience with transaction volume up by double digits in all 4 counties we follow..including York, Cumberland,  Sagadahoc and Lincoln.  The brightest spot in the market continues to remain the city of Portland itself and thus the entire greater Portland market.  Year over year prices remained stable with the median price clocking in at 215K.. exactly where is was a year prior.  Unfortunately the mid coastal real estate market continues to see downward pressure on pricing with values down 10% in the 3rd quarter 2011 for Sagadahoc county. View the full Maine housing report here.

3rd Quarter 2011 Maine Housing Results.

Transactions Prices DOM
2011 2010 Change 2011 2010 Change 2011 2010 Change
York 616 540 14% 210 214 -2% 79 74 7%
Cumberland 920 820 12% 223 222 0% 60 62 -3%
Sagadahoc 97 79 23% 163 183 -11% 46 86 -47%
Lincoln 109 92 18% 160 198 -19% 126 103 22

View the full Maine Association of  Realtors press release here


3rd Quarter Mid Market report for Greater Portland

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Posted by Kate Hodgson – The Herrigel Group – Green Tree Realty

July was marked by sluggish sales and a sharp rise in new listings. This created the greatest imbalance in July figures for the 14 year period I observe.

227 properties sold in the Greater Portland real estate market in July 2011, compared with:
186 in 2010 (skewed by the tax credit incentive)
245 in 2009
236 in 2008
267 in 2007
229 in 2006.

There were 1.37 new listings for every property sold in July 2011, well above the monthly average of .92. However, the ratio was also down significantly from previous months this year.

The average sale price rose in greater Portland rose slightly and the average Days on Market (DOM) fell slightly.

The advantage is clearly on the buyer’s side with low interest rates, low prices, and a large inventory.

In national real estate news:
Interest rates have fallen to historically low levels once again, dipping below 4%.

Realty Trac has reported that foreclosure activity has fallen to its lowest level since November of 2007 although the Wall Street Journal reported on 8/23 that the number of households falling behind on their mortgages increased slightly in the second quarter or 2011.

Despite the sluggish Maine sales.. the Portland home and Portland Maine condo markets continue to fare quite well.  We here at the Herrigel Group also just created a sweet new web page to provide in depth analysis on condominium associations in Portland Maine thus please do check it out or feel free to look at one of our great neighborhood pages on either homes for sale on the West End or check our East End Real Estate overview.

Maine housing prices update – June 2011


Housing prices continue to stabilize and in some cases may actually be rising a bit right in Portland proper as our case study in our most recent Maine housing report for May illustrates as year over year prices for homes and condos in Portland Maine have been up for 6 straight months in a row!  Overall however it seems that most of the southern Maine and mid coastal markets are continuing to experience much of the same…lower transaction volume.. down about 30% overall in 2011 compared with 2010, but stable pricing for the most part.  List to sales ratios have continued to hover around 95% and the strongest market continues to be the first time home buyer one as rental prices for the most part are creeping up..coupled with historically low interest rates has thus enabled parties to own for less than they can rent.. another reason the real estate markets have remained stable..  See overall housing statistics below for the 4 counties I follow and  here is another great recent housing report from a local Portland Maine realtor as well.

May – 2011 vs 2010

Transactions Prices DOM
2011 2010 Change 2011 2010 Change 2011 2010 Change
York 159 209 -24% 188 189 -1% 101 65 5%
Cumberland 282 366 -23% 219 206 6% 59 61 37%
Sagadahoc 28 53 -47% 170 171 -1% 41 38 -34%
Lincoln 14 27 -48% 130 125 4% 232 140 66%

Cumberland County Foreclosure Update


As winter continues to rear its ugly head here in the great state of Maine.. I though tit might be interesting to take a look at how the foreclosure world was faring in Cumberland County, home of Portland Maine, and the largest county in the state.  Thanks to my friends at RealtyStore.com I was able to get some fantastic information and accurate data on how many actual foreclosure listings are currently available.

As of 2/23/2011… 62 total foreclosure properties in Maine are for sale and listed at a median sales price of $129,000. Of these 62 properties… 41 are bank owned, 10 are owned by the government and there are 11 shadow listings, meaning they are not being actively listed.

Luckily Maine has fared significantly better than other parts of the county and although foreclosures due exist they are definitely not the norm!

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