Fewer Homes For Sale Every Year: The Downward Trend in Maine Residential Listings
I recently saw a visualization of the number of homes for sale in Maine by month over the last seven years and was struck by an obvious trend. That trend is visualized by the red line in the graph you see below. I started in the Real Estate Business in 2017 and every year I have been providing professional services to home buyers and sellers there have been less homes listed in Maine than the prior year. In the same time Maine’s population has grown by some 15,000 residents. This means that in a simplistic, broadest view of Maine’s population and housing trends, there are twenty-five more people who live in this state for every house that is listed for sale than there were seven years ago. Getting data to dig deeper into certain subsections of population, price, and region is more difficult. However if I had to guess based on my experience in the field, this crunch is more acute for lower earners and more affordable homes.
What does all of this mean for Home Prices? Classic economics tells us that when the demand for a thing is rising and the supply of that same thing is falling, the price is bound to increase. Maine housing is about as clear cut a case of this as can be seen. Higher interest rates on borrowing have likely tamped the growth in sale prices somewhat, but they have also disincentivized people with low interest rates that they locked in during COVID from selling and moving to new homes financed with higher interest rates. In January of 2017 the median home in Maine sold for $190,000. In January of 2024 the median sale price in Maine is currently $350,000. Will these trends continue? Will the median house across the state cost $650,000 in 2031? That trend would mean that the median house in Cumberland County sold for over a million dollars in that same time frame. It feels unlikely to type that out, but saying the median would hit $350,000 would have felt equally unlikely in 2017.
The question this graph begs is why? The simple answer might be that Maine is a wonderful place to live and once people buy a house here there is little incentive to move. Easy as this answer is, the truth must be more complex. The culprits are so numerous that they almost warrant their own separate blog posts. Without delving too deeply into each bullet point, there is good data to suggest that each of the following trends plays a roll in decreases in the number of home sales in Maine
People are living longer: Maine is the oldest state in the nation The Median Mainer is two full years older at 45 years old than the median citizen of Florida, West Virginia, Vermont or New Hampshire, the four states tied for second at 43 years median age. As old people continue to live longer they continue to use their homes.
Older people occupy their homes later in life: The downtrend in downsizing needs its own post for analysis but the short answer is that many people are choosing to age in place in their homes rather than downsize or move to assisted living facilities. This means that these homes are not turning over and being listed for sale.
Divorce rates have fallen for decades: Divorce is a common driver of home sales. Couples change their priorities about where they want to live and end up selling their homes in the process. People get divorced in Maine at lower rates than they have in the past and that means less homes end up on the market for this reason.
Work from home: The ability to work from home reduces some people’s need to sell their homes. Historically getting a new job was more likely to necessitate a geographic move. No there are fields where a professional can simply change the system they log into in the morning without having to put their home on the market.
Lack of options: While Maine is seeing more new home building than it had in the past, the number of new units being constructed remains well below the number that people would buy when given the option. Combine this with the decrease in sales that this post has discussed and you find that people choose to stay put rather than move because they can’t find a new house that suits their needs.
What does this mean for you? Buying and selling are both tricky right now. They each present opportunities and challenges that I help clients to navigate every day. Buyers are working with limited options against a host of other would be buyers. Sellers have an opportunity to capitalize on the current trends that would benefit from a professionals guidance. If you’re thinking about making a move send me a message or give me a call today and let’s talk about the best strategy for your goals.
Want an interactive version of this chart that you can delve into a bit deeper? Shoot me a message and I’m happy to share the link.
