There was an increase in new listings for the fourth month in a row in both Cumberland and York counties when comparing data from 2022! Despite the continued increase in inventory, median sales prices continue to rise as well: 12.2% in Cumberland County and 4.7% in York County. While closed sales tend to lag 30-45 days beyond when a new listing hits the market, one would think that the increase in inventory for four months straight might provide some relief to buyers. However, what this points to is that, despite the increase in new listings, there is still a shortage of housing.
As detailed in this Maine Housing Report [https://mainehousing.org/docs/default-source/default-document-library/state-of-maine-housing-production-needs-study_full_final-v2.pdf?sfvrsn=b10a8015_13] (shared last month as well), Maine needs 38,500 homes to counter years of underproduction and an additional 37,900 to 45,800 homes by the year 2030 to meet demand.
Not helping matters for buyers looking for their primary home is that Cumberland and York counties appear on a list of the top 10 markets with the largest increases in second home transactions from 2022 to 2023 [https://www.bangordailynews.com/2023/12/06/business/maine-fastest-growing-markets-second-homes/].
Years of underproduction and the increased growth of the second home market are only two of the many factors contributing to the continued increases in home values in these two counties, but it does all come down to the simple economics of supply and demand. With interest rates falling to a near 4-month low [https://www.reuters.com/markets/us/us-mortgage-rates-fall-nearly-4-month-low-freddie-mac-2023-12-07/], the demand for homes is only likely to increase as homes become more affordable to buyers.
Stay tuned for next month's stats, as we follow along to the unfolding changes of Maine's real estate market.