I 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 second quarter as Q3 and so on

General trends in Q3 2011:

Sales are down and new listings are steady; this has brought modest improvement in the balance between inventory and sales for Q3 of 2011.

Prices are down 7% overall from last year but have remained steady, or shown improvement, in some of the towns observed.

A note of caution: the sales figures for 2010 were skewed by the $8000 tax credit incentive which expired April 30 of that year. This pulled much of the year’s activity forward into the first 2 quarters.  Comparing the figures for this year to last year is fraught with pitfalls because we don’t know how many of those sales would have taken place later in the year, if at all, if the tax credit incentive had not been in place.  A more significant indication of trends is found by comparing 2011 figures with 2008 and 2009.

1. Inventory and 2. Sales:

Compared with Q3 of 2010, the number of new listings declined in all areas observed but the number of units sold was up 16% (probably due to last year’s tax credit acceleration).  The number of units sold is still lower than it has been for over 10 years.

In Portland and South Portland the number of single family homes sold increased 17% from Q3 last year.  More significantly, inventory decreased to 1.32 new listings for every property sold; the lowest Q3 ratio in 4 years and below the average for the 14 year period, indicating a healthier balance between supply and demand.

In Cape Elizabeth, Falmouth, Scarborough, and Yarmouth, the number of properties sold increased 15% from last year but was in line with Q3 of 2007 and 2009.  There were 1.41 new listings for every property sold, down substantially from last year, below the 14 year average, and the lowest Q3 ratio in 7 years.

In Gorham, Gray, Westbrook, and Windham the ratio was 1.82 new listings for every property sold in Q3 2011, in line with the figures from 2007 and 2008. The number of properties sold declined to the lowest level in the 14 year period.

3. Prices:

Prices have continued to show unpredictable fluctuations but at a more modest pace than recent years.  The average sale price increased 3% in Portland and South Portland and increased 2% in Windham, Westbrook, Gorham and Gray, but decreased 4% in Yarmouth, Falmouth, Cape Elizabeth and Scarborough.

Perhaps more significantly, sellers appear to be more realistic than recent years as the sales prices have been more closely aligned with the list prices at the time of sale.

The average sale price for all of these towns was $264,692 and the median price was $237,000.  The lowest sale for the quarter was $40,000 and the highest was $2,000,000, ironically both in Scarborough.

The lowest low price:

Again, the latest figures show that we are bumping along the bottom of the market.  The last quarter had the lowest list price, at the time of sale, in over 5 years which is holding steady around $45,000.  Highlights indicate the peaks and troughs for the 5 years shown.

4. Days on Market (DOM):

The average number of days it is taking for a property to sell decreased in Portland, South Portland, Cape Elizabeth, Falmouth, Scarborough and Yarmouth, but increased in Gorham, Gray, Westbrook and Windham. This may be due in part to short sales becoming more streamlined and taking less time than in recent years.

Snapshot of the real estate market in individual towns:

The table below shows activity for individual towns in the Greater Portland area.  As a general rule I have regarded a market as active, with a healthy rate of turnover, when 20%-25% of the inventory is under contract (column in bold).  Percentages above that indicate a hotter market.  Information in the last 2 columns, on current inventory in relation to recent sales figures, also provides a good snapshot of supply and demand for these areas.

There are two interesting, and conflicting, features to this quarter:

1. There are fewer towns above 20% under contract than usual

2. There are no towns below the 10% mark

D, NG, NoY, P* = Durham, New Gloucester, North Yarmouth, Pownal

Condos (Portland Maine  and South Portland):

The Portland condo market remained largely unchanged from Q3 of 2010. The number of new listings was down slightly and the number of units sold was almost the same. There were 1.6 new listings for every unit sold.

The number of days it is taking condos to sell increased slightly and the average sale price was down 2% over last year.

On October 18, 2011 there were 189 condos currently on the market in Portland and South Portland and 26 under contract, or 12% of total inventory. There were 3.16 condos on the market for every condo that sold in the third quarter of 2011, indicating a lackluster market.

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

By comparison the Maine multi-unit market appears fairly robust.  The number of new listings was down slightly from last year but the number of units sold jumped 48%. Forty nine 2-4 unit properties sold in Q3 of 2011, the highest number since 2005 and slightly lower than the average for the 14 year period.

As of October 18, 2011 there are 111 2-4 unit properties on the market in Portland, South Portland, and Westbrook, with 26 of those under contract, or 23% of current inventory.  There were 2.36 listings for every unit that sold in Q3 2011.

Links, notes and the news:

The good news:

According to a recent report by Franklin American, construction spending and service sector spending are both up and the manufacturing sector is expanding.

The bad news:

The number of jobs added doesn’t come close to the number lost since the recession started in December of 2007.

Let’s wait:

Buyers:

Recent Bankrate.com surveys show that first-time home buyers are now favoring homes that are in move-in condition and are shying away from fixer-uppers.

According to Apartments.com, 20% of the respondents who are looking for apartments this year are current home owners; 28.8% of respondents said they were relocating for a job, up from 10.4% last year.  Even these respondents are being choosy; most said they are 5 months or more away from selecting a rental.

Sellers:

The WSJ also notes there is a “lack of attractive inventory” as voluntary sellers are withdrawing from the market, foreclosures are stalled because of irregularities, and the lack of demand is keeping prices soft.

Refinances currently account for 85% of loan origination and it takes around 3 years to recover the associated fees indicating that sellers intend to stay put that much longer. Additionally, permits for remodeling jumped 24% in July, according to Buildfax, signaling that potential sellers intend to make due for the time being.

National Trends:

The Census Bureau reported last week that the rate of home ownership dropped the largest amount since the great depression in the last decade yet the percentage of Americans who own their homes remains the second-highest on record.

At the same time, 30 Year fixed rate loans fell below 4% for the first time according to a Freddie Mac surve

Interesting links:

Refinancing Chills Demand for U.S. Home Purchases Amid Economic ‘Squeeze’

Bloomberg.com, by Kathleen Howley, Oct 14

http://www.bloomberg.com/news/2011-10-14/refinancing-chills-demand-for-u-s-home-purchases-amid-economic-squeeze-.html

Economist stirs controversy with sunny housing forecast

Boston.com, by Scott Van Voorhis, Oct 14

http://www.boston.com/realestate/news/blogs/renow/2011/10/economist_stirs.html

Slim Pickings are Latest Headache for Home Sales

WSJ.com, by Nick Timiraos, Oct 17

http://online.wsj.com/article/SB10001424052970204774604576631381117760982.html

If you would like to discuss how this information can better inform questions you may have about buying or selling in your particular situation, please contact me: (207)807-1140 or katehodgson@yahoo.com.  You can also find me on twitter.com where I post trivia questions about Greater Portland history.

Mid Coastal Maine is still struggling to see activity, yet my sense is that once we thaw.. there is going to some serious real estate action in Maine.  Many buyers are looking and are simply having a hard time finding something given the lower inventories around, but this should change as Maine sellers will begin relisting as early as March 1st I suspect.

To read the complete January 2011 Maine real estate housing report please click here.

Thanks for stopping by and thanks to the Maine Association of Realtors for their statistics.
John

Below are detailed housing statistics on all the communities within the region.

Maine Housing Results for October 2010

Click here for the complete Maine real estate report.

Overall I feel there is a lot of pent up demand in the marketplace and if rates continue to creep up  I think we are going to see a significant pop in transaction volume which will further help to stabilize the regional marketplace.

Thanks for reading,

John

With that said… here is some data on how the greater Portland residential housing market fared in the 3rd quarter of 2010.   490 homes and condos sold at a median price point of 250K representing a transaction volume decrease of 37% and a pricing increase of 9% year over year although this pricing increase is more  a function of less first time home buyers in the marketplace than of real price appreciation.  Read the full 3rd quarter Maine report here.

It seems the markets of southern Maine have come alive as of late, but don’t expect any drastic gains in the near future. More than likely prices will flat line for a while, but with price stablizing buying has never been more attractive in this humble Realtor’s opinion.

You can search all Maine homes for sale here  if you would like or leave a comment and let me know where you think the market will go.

Having recently published my October housing newsletter on the real estate markets of York, Cumberland, Sagadahoc and Lincoln  counties it was no surprise to find that volume continues to remain off about 20% in the southern ME real estate markets compared with a year prior.

Statistically speaking prices were up in September, but these increases are more the result of a less first time home buyers in the marketplace  than of actual price increases.  Overall I feel the regional marketplace continues to see price stabilization.

Thus far through October buyer traffic has been stronger and with interest rates pushing 4%, if one qualify for a loan..DO IT!!!… these rates will not last!

Some questions going forward will be…How will the foreclosure fiasco play out…What will rates do?…Will title companies insure foreclosed properties? Will the Economy start generating jobs!!

Median pricing rose year over year in all 4 counties with York and Lincoln counties leading the way up  8% and 11% respectively.  Cumberland County, home to Portland, remained steady seeing a 2% rise in median pricing.  Additionally the  days on market average continued to drop throughout the region.

The general feeling in the market place is encouraging.  Homes are selling if priced right, many active buyers are looking and sellers have for the most part have accepted what their homes are worth and thus are listing at realistic prices.

Please feel free to read the entire southern ME housing report here.

Thanks for reading,
John

For the month ending April 30th the region as a whole was up about 40% or more in transaction volume compared to a year prior and relatively flat compared to March figures.  Median pricing in Portland and South Portland was actually up 6% and 27% respectively year over year but the small sample sizes can be a bit misleading and overall pricing is stable to slightly increasing in the city whilst holding steady in the surrounding suburbs like Cape Elizabeth, Yarmouth and the real estate markets in Falmouth.

For more detailed overviews on the individual communities please visit my southern ME real estate or mid coastal Maine housing overview pages at www.mymaineproperty.com.

Thanks for reading,

John

The southern and lower mid coastal Maine region as a whole has seen stabilizing prices with the past 3 quarters median prices clocking in at 228K, 229K and 225K respectively.  Transaction volume has also been strong, up 29% in the 1st quarter 2010 compared with the 1st quarter 2009.

The entire Maine real estate report can be obtained here or by contacting me directly at john@greentreemaine.com

Going forward look for continued growth in transaction volume coupled with steady pricing, but  if rates continue to tick upwards this  market will see an end to its borderline euphoric state.
Thanks for reading,

John

As I write the markets are as hot as they have been in well over 3 years thanks largely to the first time home buyer tax credit as well as the continued low interest rates, under 5% in most cases!  As March, April and May housing statistics become available be sure to check back in as I suspect we are going to see some very encouraging results. Many homes in the greater Portland Maine housing market continue to see multiple offer situations, sold prices at or above asking prices and extremely healthy buyer interest.