Maine Real Estate Market Report

    Last month we looked at real estate sales for Lincoln County, Maine and compared actual sales, as measured by the Maine Real Estate Information Service (our Statewide MLS), for the months of December and January in both 2006 and 2007.  Sales were off but while dollar volume was off by almost 25% we saw that actual sales were only off by 8%.  This was somewhat encouraging and many in our industry saw this as a sign that the "soft landing" that we had all been hoping for had occurred and things would soon be back to the way they were in '04 and '05.

   Now February is behind us and a quick look at the raw data for that month suggests that maybe our exuberance was irrational.  In Lincoln County for the month of February 2007 there were 22 closed sides with a total dollar volume of $7,378,000.  For the same month last year there were 42 closed sides with a dollar volume of $11,627,000.  Inventory continues to climb and average days on market has increased, too.

   Statistically speaking this is way too small of a sample to make the kinds of predictions that people much smarter than I make all of the time.  Was the increased activity at the end of the year the beginning of a better market or the "dead cat bounce"  of a market at the bottom?  My perception is that we are in a period of readjustment and that we will have up and down months for some time.  Todays market is not bad because of some economic calamity like a large employer leaving the area.  Our market is primarily driven by retirees and second home buyers.  While this time of year is traditionally slower than others I think the bigger problem is that our buyers have usually just sold a property.  Because of that they have adjusted to the new market realities, i.e. lower prices.  Our sellers are still adjusting.  Those properties that are priced realistically for todays market and not the 2005 market are selling.

   Quite simply the law of supply and demand is at work here and I'd refer you to Adam Smith for a more in depth analysis of how that works but suffice it to say, price rules.  If your property is not priced correctly, there is no place that we can advertise, no magic phrase we can use, no picture we can take that will make it sell.

   If you are thinking of selling your home and would like an objective and realistic idea of where you fit in todays market to help in your decision making please contact one of our professional brokers for a confidential analysis today.

Jim Cosgrove

Comments

[Linda Hutchins]

Real Estate blogs are a great idea.

Transparency would be of immeasurable value to Maine.