YORK COUNTY — Interest rates are up and the inventory of existing homes for sale is lower than ever, contributing, according to the Maine Association of Realtors, to fewer home sales statewide in 2022 as compared to 2021. Still, median prices were up statewide to $335,000 or by 12.04 percent over 2021.
In York County, home sales were down by 16 percent in 2022, but the median sales price was $450,000, up from $398,750 in the prior year, according to the realty association.
The president of the York County Council of the Maine Association of Realtors, long time real estate broker Teri Woods, said she is feeling positive about the year ahead.
“I don’t have a crystal ball as to where things are going, but my thought is it will become a more balanced market, which is always healthier,” said Woods in a recent telephone interview.
Woods, who was first licensed in 1986, and works from central to southern York County and in New Hampshire, acknowledged that York County is seeing a tighter marketplace than other Maine counties – low inventory is a big factor and particularly impacts first time homebuyers and those who hope to downsize.
“York County’s current housing supply remains low and is unable to meet the demands of the marketplace,” she said. “Right now, there is a 1.6-month supply of homes currently listed for sale. A more balanced market would be a six-month supply.”
Recalling 2019, she said the December 2022 inventory of existing homes for sale in York County is 56 percent lower than in that pre-pandemic year. And, she said the fact interest rates were low during the past few years meant some sellers took their homes off the market and refinanced, and homebuyers made purchases, contributing to the lower inventory volume.
Maine Association of Realtor President Carmen McPhail said statewide, 2022 ended with more than 16,800 homes sold and a median sales price of $335,000, the latter down 8.5 percent since it peaked in June.
“Overall, the numbers reflect the impact of mortgage rate increases, the typical fourth-quarter seasonal slowdown and a continued shortage of for-sale housing inventory,” McPhail said. For December alone, McPhail noted statistics gathered by Maine Listings indicate an 8.9 percent median sale price increase to $330,000 statewide compared to December 2021. Sales statewide declined 36.6 percent statewide, comparing December 2022 to December 2021.
Back in York County, Woods said the upward pressure on pricing is waning a bit because of higher interest rates and buyer constraints. She said properties have been on the market for more days than in the recent past – and that is not all.
“We’ve started seeing offers below purchase price, and fewer multiple offer situations,” she said of the York County market today — recalling that at its peak, people saw their home go under agreement within a day or two of hosting an open house.
It is now common to see a home on the market now for 35 to 40 days, whereas in the recent past, 7-10 days tended to be the norm, she said.
Woods also said she is also starting to see more demand for generational housing – in-law apartments or multi-family dwellings – a trend she said she is hearing about nationwide.
As of around Jan. 21, interest rates, depending on the borrower’s qualifications, hovered around 7.5 percent on a conventional 30-year loan, said Woods. But she noted there are some new products on the market offering 3-, 5- and 7-year adjustable mortgages for a couple of points less. She noted the mortgages stay at the stated figure for the period, then adjust when it expires.
Similar mortgages got a bad rap during the 2008 recession, but Woods pointed out those were one- and two-year programs. With the new offerings one could either sell — typical homeowners stay in their homes seven years, she said — or refinance under a fixed program.
McPhail, who works down east, said agents statewide are seeing a bit of a pause as buyers and sellers adjust their expectations due to today’s financing terms. But she too had a positive outlook. “As we move through 2023, we expect would-be buyers to re-engage with the market and the demand for residential real estate to remain high,” said McPhail. “Conditions are favorable for a gradual balancing of the real estate market.”
She said a balanced market is better “for everybody, buyers and sellers.”
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