Maine real estate market shows signs of cooling amid rising mortgage rates
Rising mortgage rates, inflation, and recession worries could fuel a downturn in real estate sales. According to Maine Listings, there was a nearly 12% drop in the number of homes sold from May of last year to May of this year, but that was coupled with a robust median home price increase of nearly 15%.
Realtors say buyers looking to purchase homes in Maine need to evaluate how changing mortgage rates and inflation will impact what they can afford.
"We are cultivating these opportunities but they are shifting. So it's a matter of educating our clients to make the best decision in current market conditions, and that's changing ever so slightly," said Madeleine Hill, the president of the Maine Association of Realtors.
The median price for a home in Maine hit $350,000 in May. And while mortgage rates have dropped for a second week in a row, but are still averaging above 5%, notably higher than the 2.9% of a year ago.
The National Association of Realtors reported a national sales decline of 7.7% in May 2022 compared to May 2021, while sales in the Northeast eased 9.3% during the same time period.