Southern Maine Real Estate Market Conditions

A few weeks ago the National Association of Realtors released March statistics showing the largest drop in 18 years for home sales. The Maine Association of Realtors released statewide statistics showing a statewide drop of 12.4% compared to 8.4% for the nation. Despite these drops the average sold price for the month of March continues to move higher, 0.5% nationwide and 2.5% for Maine. The housing statistics for the 4 counties followed mirror the national and statewide stats; lower volume, higher average prices.

Largely attributed to stricter lending practices rolled out in March and significant harsh weather thanks to mother nature, the activity in the local markets continues to remain strong and not as dire as the statistics may lead one to believe. What does this mean going forward? Basically there is a lot of uncertainty and the traditional strong and robust Spring markets will most likely not occur. Maine Investors continue to stay on the sideline waiting to see how the residential markets will pan out.

The residential markets will continue to slow down as the ripple effect of first time home buyers who are not able to enter the market will thus effect the sellers of these homes buying their upgraded home and so on up the ladder, with estimates that for every entry level home that does not sell results in 3 more higher priced homes that will not sell. Thus for now it seems despite the continued growth in average prices in Maine, the overall market is going to continue to slow down until lenders figure out how best to deal with the many default loans that will continue to surface.

John Herrigel is a Maine real estate agent and investor. He can be reached online athttp://www.mymaineproperty.com or http://www.mainepropertyblog.com.