Southern Maine 2011 and 2012 Housing Starts

Single Family Construction Starts

2011 - 2012*
*Jan. - Sept.

Over 50% decrease    50 - 33% decrease    0 - 33% decrease 0 - 25% increase
25 - 50% increase    50 - 100% increase    100 - 200% increase Over 200% increase

Click on towns to see data   Source: Construction Data New England

November 13, 2012

New-home construction surges in southern Maine

But the rise in permits may not signal recovery, builders caution, noting that the rest of Maine is still in the cellar.

By Jessica Hall
Staff Writer

New-home construction in southern Maine has jumped 35 percent in 2012, a rebound from last year when housing starts in the region hit a 20-year low.

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A worker installs siding Friday on a new home in the Sunrise Ridge subdivision along the Portland Road in Buxton. In southern Maine, places where construction of new homes has increased substantially since last year include Kittery, Waterboro and Wells.

John Patriquin/Staff Photographer

While the news is good, it does not necessarily signal a recovery, builders say. They caution that the figures mark mainly prime locations in southern coastal towns and that new construction in the rest of the state remains stagnant.

The number of new-home permits in southern Maine is still well below pre-recession levels and some builders fear this year's growth is just a temporary uptick after last year's depressed numbers.

"There are definitely pockets of growth, especially in coastal areas in York County. West of I-95, things are really slow," said Larry Duell, president of the Home Builders and Remodelers Association of Maine. "Statewide, new-home permitting is weak."

"We had a blip this spring, but by July and August, it died out," said Mark Patterson, co-owner of Patco Construction Inc. in Sanford. "We've been running along the bottom for three years. Every year I've said it can't get any worse. I don't see a big increase next year."

From January through September, builders took out 802 permits in 37 communities from Lewiston to Kittery, according to Construction Data New England. That compared with 594 permits for the same period last year.

Just before the economic downturn, 1,111 new homes were started in the first nine months of 2007. Construction Data New England in Windham tallied the number of new residential building permits for the Portland Press Herald.

The biggest gains in new construction came in York County towns such as Kittery, Waterboro and Wells, where growth doubled or nearly tripled, the data showed. However, new construction dropped in Lewiston and remained flat in Auburn.

Duell, owner of Father and Sons Builders in Lebanon, said he works primarily in Wells, where Construction Data New England said permits jumped to 110 homes for the first nine months of this year, up from 58 homes for the same period last year.

Overall, Duell said he's building 10 homes this year, down from 30 homes at the peak of the market. Each house built supports three full-time jobs, Duell said.

"The overall economy is slowly creeping up and getting better. People think in their minds that the worst is behind us," said Bob Georgitis, vice president of North Waterboro-based builder Kasprzak Inc. "We're doing very well in Wells. In Gorham, there's an uptick in interest there as well, but the pace is not anywhere near what we're seeing in Wells."

Georgitis said the firm is selling just under 30 units this year, while in peak years, it built twice that number.

While the market in southern Maine is stronger than in the rest of the state, it still faces some challenges, including tight financing by banks, which make it tough for customers to build. Also, values of existing homes have fallen, making it cheaper to buy than to build, contractors said. People who are building also often need to sell their existing home -- not easy in a depressed market, builders said.

The areas where construction starts are up bear out the adage that in real estate, location matters, especially in a weak market. Southern Maine is benefiting from a stronger job market, builders said. Unemployment in Cumberland County is 5.6 percent, and York County is 5.8 percent -- both below the statewide average of 7.6 percent.

"There's a pickup, but mostly increasing within four to five miles of the interstate. The farther you get from the interstate, the more dead sales get," said Patterson. "In Saco, Wells, there's still demand. In York as well."

(Continued on page 2)

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Today's poll: Housing market

Do you think southern Maine’s real estate market is starting to rebound?



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