MidCoast Maine Real Estate Report

    A common question from Sellers and Buyers, both actual and potential, this time of year is "What will next year look like" in terms of the real estate market here in mid coast Maine? Well, "hard tellin' not knowin'" is what the old timers might say but we can take an educated guess.

   Right now here in Lincoln County, half way between Maine's' largest city of Portland and the once Lobster Capital of the world Rockland, on the coast, we have a very large inventory of existing homes on the market.  Three years worth of normal sales give or take. We have seen incremental improvement in the market in terms of more homes selling this year than last but the glut of inventory has served to drive prices down. At this time its pretty fair to say that the market has re set at about 25-30% below the prices we were seeing Sellers achieve at the peak in 2006.

   In just the last few weeks we have begun to see market prices firm up and Sellers refusing to go lower than that 30% from peak discount and still move their property. I expect we will still many properties selling for lower prices than they are now on the market for but the quality properties are finding buyers and do appear to have stopped sliding.

   By quality properties I mean those that are in the most desirable locations and are in very good or better condition. There are still bank owned homes coming to market but these are at the lower end of the market and are generally in pretty bad condition by the time they hit the market.  It seems to take lending institutions about 2 years to bring a property to market and not only do the departing owners not leave under the best of circumstances but in the interim the banks don't do a very good job of maintaining the property. These homes sell at sharp discounts but are not "move in" by any means.

  While we may have found the approximate bottom of the real estate market in terms of price I certainly do not expect a sharp upturn at this time.  I do expect that sales will increase as we go into the new year.  The government programs presently in place for first time and move up buyers will help some but of more help will be the continuing historically low interest rates. The government has simply pumped so much liquidity into the financial markets that it has begun to have a very positive effect and I expect that to become more pronounced in 2010. The excess inventory however will serve as a brake on price increases and it will take a year of normal sales volume at the very least to get back into a reasonable inventory level.

   In short, I  see 2010 being a year of healthy sales volume here in the mid coast with very little change in prices either up or down.  Assuming a Seller is going to become a Buyer the day after their home closes it is a good time to be in the market as there is so much to choose from and borrowing costs are as low as they will ever be.

   For an overview of the southern Maine/Portland market be sure and check out our friends at the Maine Property Blog.

Jim Cosgrove

Comments

[Philippines property]

Good information on the selling aspect. Thank you.

Deirdre G

[John Herrigel]

Enjoyed reading this Jim as one of my new years resolutions is to actually read other people blogs instead of only writing on mine :). Thanks for the shout out as well!!

In the greater Portland area, housing prices have stabalized I think much better than up in the mid coastal regions.

All the best,
John

[Asia condos]

Thank you for the kind words regarding real estate. I am humbled by this.