The market for building, buying and selling apartments and condominiums in the Portland metro area remained red hot in 2016, according to presenters at the annual Maine Real Estate and Development Association conference Thursday.
“Multi-family and condominium construction in Portland is exploding with hundreds of units added within the past two years, additional product under construction and even more in the pipeline,” said Drew Sigfridson, managing director of CBRE|The Boulos Co. in Portland.
Brit Vitalius, principal and designated broker at Vitalius Real Estate Group in Portland, said that while downtown Portland remains the most desirable area for investors in multi-family housing, surrounding areas are also seeing a surge in activity.
From 2015 to 2016, the sales volume of apartment units increased by 57 percent in Westbrook, 24 percent in Lewiston-Auburn, 23 percent in South Portland and 12 percent in Saco-Biddeford, Vitalius said.
“Downtown (Portland) is hot, but it’s ALL good,” he said.
The median sale price for multi-family units also increased in all of southern Maine’s major markets, Vitalius said. From 2015 to 2016, the median price increased by 9 percent in Portland, 12 percent in South Portland, 3 percent in Westbrook, 6 percent in Saco-Biddeford and 14 percent in Lewiston-Auburn, he said.
The absorption rate for apartment housing – defined as the amount of time it would take to sell all existing inventory at the current rate of sales – plummeted in 2016, according to Vitalius. In Portland, it fell from 5 months in 2012 to 2.3 months. In South Portland, it dropped even further, from 5.5 months in 2012 to 1.5 months. In Westbrook, it fell from 5.7 months to 2.4 months.
In addition, condominiums have become a major force in Portland’s residential real estate market.
According to David Marsden of the Bean Group, there were 972 Portland residential sales in 2016, of which 345 were condos.
The sales were heavily weighted toward less-expensive homes, he said. Just over 200 condos were sold for less than $300,000, while 68 fell in the $300,000 to $400,000 range; 34 sold for between $400,000 and $500,000; 35 between $500,000 and $800,000 and five sold for more than $800,000.
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