Saturday, March 8, 2014
SOUTH PORTLAND – Sales of existing single-family homes spiked in Maine last month, ending 20 percent higher than sales in August 2012 and topping year-over-year gains seen nationally and in the Northeast as rising mortgage rates motivated buyers to make deals.
A sale sign hangs outside a house in Walpole, Mass. U.S. single-family home sales rose in August to the highest level since February 2007 and median prices jumped 14.4 percent as buyers rushed to close deals before interest rates rise.
The Associated Press
In addition, the median sale price for the 1,506 homes sold last month hit $182,000 – a year-over-year increase of 7 percent, according to Maine Listings, a subsidiary of the Maine Association of Realtors. The median sale price means that half of the homes sold for more and half sold for less.
"There's a continued optimism in the market," said Bart Stevens, president of the Maine Association of Realtors. "It continues to be a great time to list and sell in Maine overall."
Stevens, owner/broker with Century 21 Nason Realty in Winslow, said many Maine markets have plenty of move-in-ready inventory available.
"Sellers understand the importance of staging their homes correctly, and those who prepare properly are selling faster. There are a lot of motivated buyers out there," Stevens said.
Nationally, sales of single-family homes rose 12.8 percent compared with a year ago, and median prices jumped 14.4 percent to $212,200, according to the National Association of Realtors. Regionally, sales in the Northeast rose 12.7 percent and the median sale price increased 7.6 percent to $268,800.
The pace of sales nationally was the highest since February 2007.
Lawrence Yun, chief economist with the National Association of Realtors, said the housing market may be experiencing a temporary peak.
"Rising mortgage interest rates pushed more buyers to close deals, but monthly sales are likely to be uneven in the months ahead from several market frictions," Yun said. "Tight inventory is limiting choices in many areas, higher mortgage interest rates mean affordability isn't as favorable as it was, and restrictive mortgage lending standards are keeping some otherwise-qualified buyers from completing a purchase."
Despite concerns that there may be a national peak in home sales, Maine Realtors say that's not the case here.
"Mainers are feeling better about what's happening in the economy and are ready to go ahead and make purchases," said Tina Lucas of Lucas Real Estate in Portland. "We also have people who are moving here from all over the country and the world. There's a quality of life issue that is drawing people from all over -- there's no traffic, no smog, great health care, great access to nature. It's getting harder to find all that elsewhere."
Kellie Levandowski, who completed the sale of her Cape Elizabeth condominium on Friday, said she got an offer after the property was on the market for just eight days. The price compared favorably to other recent sales in the area, she said.
"Given what other condos in my development have been selling for, I was very pleased," said Levandowski, who now lives in Kennebunk with her boyfriend.
Her real estate agent, Kathryn Townsend, said high demand and low supply have been driving up prices since the beginning of the year.
"I've got clients who have been looking for six months," said Townsend, owner/broker of Townsend Real Estate in Cape Elizabeth.
She said the recent increase in home prices has made selling more attractive, and rising interest rates have created a greater sense of urgency to buy.
Interest rates have risen amid speculation that the Federal Reserve might rein in its efforts to stimulate the economy. On Wednesday, however, the Fed surprised economists and postponed efforts to ease its monetary stimulus.
According to Freddie Mac, the average national fixed rate for a conventional 30-year mortgage rose to 4.51 percent in August, up from 4.32 percent in July. The rate was 3.59 percent in August 2012.
Improvements in the economy and job market have given some prospective vacation-home buyers more confidence, Townsend said.
"I have a lot of out-of-state buyers that just find the area really attractive," she said.
Staff Writer J. Craig Anderson contributed to this report.
Jessica Hall can be contacted at 791-6316 or at: