Two years ago, I was presenting my Historian’s Report at the Kennebunk Fire Society’s annual dinner and meeting. My topic included the events and emotions leading up to Massachusetts’ decision to give up Maine as a part of the 1820 Missouri Compromise.

Considering the pandemic-fueled real estate market, is the Commonwealth of Massachusetts suffering buyer’s remorse? Could the glut of sales be part of a covert conspiracy to bring Maine back into the Bay State fold? Photo courtesy of Maine Turnpike Authority

That’s a pretty dry subject, even for a retired U.S. history teacher, especially after the dinner guests had feasted on turkey dinners with all the fixings. I threw in a personal quip that our local real estate sales meant that maybe today’s Massachusetts was suffering buyer’s remorse. Could this be part of a covert conspiracy to bring Maine back into the Bay State fold?

Some diners laughed. A few of the more recent ex-Mass émigrés told me later they weren’t pleased. None of us could have imagined what was coming.

Before 2020, the Maine real estate market followed a set pattern, usually favoring the buyer. It wasn’t rushed, because there was never a shortage of available houses. The buyer often asked a bank for a letter certifying you were mortgage pre-qualified.

Open houses were common and the buyers had many choices. Once a decision was made, it was a pretty standard offer. Submitted at 90 to 95-percent of the listed price, it required either an 80- or 90-percent bank approval (a certain deal killer if not obtained), and an inspection, which afforded the potential buyer an opportunity to nit-pick down the final price. A rare gem came along sometimes and sold for a couple of thousand over the listing price.

Once the final contract was inked, the savings and loan started its paperwork, a credit check was completed, the title was searched, and a deed prepared. Spring was the busiest time. Families wanted the kids in school in September. Back then, it was mostly a fair-playing field for achieving the American dream of owning your own home. It had been that way for our parents, too, and it looked to continue.

I wasn’t far off with my quip at the 2019 dinner. There had been a clear “from away” uptick in our local housing market. Empty-nesters were either downsizing or moving to Florida. Prices were appreciating. Soon the locals were shaking their heads, as 1 percents were discovering us and tear-downs were replaced by McMansions.

A trend was developing.

To the south of us, a growing number of the grass-is-greener-on-the-other-side dreamers were tiring of rising crime rates, long drive times to work, high property taxes, urban blight, polluted air and just too many people.

Many had fond Maine memories of camp week or family summers at the shore or the lake. Some had grown up in Maine, but had left after graduation. The allure of Maine was always calling them. Then COVID hit and as the infection rates surged elsewhere, Maine began to look like a safer shelter in the middle of a raging blizzard.

The rush was on, but none of us could have anticipated this new real estate market which was pumped up on steroids. It was also happening in the middle of a deadly COVID pandemic which was effectively shutting down New England.

Many local home owners, hearing rumors of escalating home prices were enticed, but they were reluctant to put their properties on the market during a pandemic. Our realtors had to abandon their traditional open houses, but quickly rallied and had virtual tours and up to 50 professionally-shot photographs for each property listed on the agency’s website. They compiled lists of their most committed, flush and desperate house hunters.

At first, there were only a small pool of properties, ranging from the starter home or condo up to the luxury estate properties. The hottest sector was the $300,000 to $600,000 range. Given the law of supply and demand, a raging bidding war broke out in early 2020 spring and continues unabated today.

Houses began selling the first 24 to 48 hours they were listed. Realty signs were going up and then down so fast, it began to look like our local version of the Whack-a-Mole carnival game. Sold signs appeared in every neighborhood. The market was so hot, some of the bidders made their offer without being able to walk the property. The old standard offer drill was junked. It was now replaced with who had the biggest pool of cash and the quickest pen.

Out-of-state bidders, hoping to rise above the pack, made all cash offers with attached certified bank letters stating the available cash for properties with already highly inflated listing prices. To improve their odds and eliminate any wasted time for counter-offers, they included escalator clauses, indicating, if they were outbid, how much higher they were willing to go. We know of escalators, that added up to $75,000 more to the original offer.

More home buyers, gasping when they heard these staggering sale prices, put their properties on the market. Competition was so intense, many cash buyers dropped the inspection requirement, becoming an as-is, that they would be responsible for any needed repairs or property defects. Many desired a quicker closing date. The cash in their checkbooks must have been burning a hole in their pocket or purse.

Just like COVID and its Delta variant, no one knows if or when this Maine real estate rush will end or its effects upon our three towns and daily lives. Will these new residents impact us? Will we impact them and their expectations? Will our fellow Mainers be able to afford a home along our coast?

Maine’s political pundits are already describing York County’s narrow strip of land, 12 to 15 miles inland from salt water, as Massachusetts North.

Tom Murphy is a retired history teacher and state representative. He is a Kennebunk Landing resident and can be reached at [email protected]

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