The number of single-family home sales in Maine continued their recent slide in October and double-digit price increases may be a thing of the past
The statewide median sales price for homes sold last month was $332,000, a 7.9% increase over the price in October 2021, and a slight increase from the September median of $330,000, according to figures released Friday by the Maine Association of Realtors.
The September median price itself represented only a modest 3.1% bump over the price a year ago. The median is the price at which half of the homes sold for more money and half sold for less.
About 1,600 homes in Maine changed hands last month, a 13.5% decrease from September and a 23.4% decrease from October 2021.
Sales volume last month outpaced the number of homes coming on the market, according to Madeleine Hill, association president and a broker at Roxanne York Real Estate in Harpswell. There were 8% fewer homes on the market last month than in September and 58% fewer homes for sale than in October 2019, before the pandemic.
“While demand remains steady for Maine’s tight for-sale inventory, increased mortgage interest rates have impacted the market,” Hill said. “Buyers who need to finance their home have less purchasing power, and the recent pricing deceleration indicates that sellers are adjusting.”
Lawrence Yun, chief economist for the National Association of Realtors, said the tight inventory is leading to some homes still receiving multiple offers. Last month, nearly a quarter of for-sale homes received offers over the asking price.
Mortgage rates, which hit record highs in October, squeezed many potential home buyers out from qualifying for a mortgage, Yun said.
“The impact is greater in expensive areas of the country and in markets that witnessed significant home price gains in recent years,” he said.
The average rate included in buyer contracts for a 30-year, conventional fixed-rate mortgage was 6.9% in October, up from 6.11% in September.
As of Thursday, the average 30-year fixed mortgage rate was slightly lower at 6.6% according to mortgage buyer Freddie Mac. The average commitment rate across all of 2021 was 2.96%.
“Mortgage rates tumbled this week due to incoming data that suggests inflation may have peaked,” Freddie Mac said in a news release. “While the decline in mortgage rates is welcome news, there is still a long road ahead for the housing market. Inflation remains elevated, the Federal Reserve is likely to keep interest rates high and consumers will continue to feel the impact.”
COUNTY, NATIONAL DATA
All 16 counties experienced fewer sales and higher prices for the three-month period ending Oct. 31.
The real estate association also looks at three-month data for county-by-county comparisons to get a larger sample size of sale transactions.
In Cumberland County, the median price was $499,000, an increase of 11.5% from the same period a year earlier, and the highest median price in the state.
York County saw the largest price increase, but the 16.34% price jump is substantially lower than the 30% and 40% increases that have been commonplace in some counties in recent months.
From August 2021 through October 2021, York County homes sold for an average of $403,500. In the same three-month period this year, they sold for an average of $469,450.
Sales declined most sharply during that period in Lincoln County, which experienced a 23.5% drop from 217 homes to 166.
Nationally, sales fell 28.2% from October 2021, and prices rose 6.2% to a median of $384,900, according to the National Association of Realtors. While still an increase from a year ago, October marks the fourth consecutive month that the median sales price has declined since peaking at $413,800 in June.
Regionally, sales fell 23% last month from the year before, while the median price in the Northeast rose by 8% to $408,700.
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