Home sales fall in Maine, median price inches up

Posted Oct. 26, 2010, at 5:40 a.m.
In this Sept. 22, 2010 photo, an existing home is seen for sale in Bainbridge Twp., Ohio. Sales of previously occupied homes rose last month after a dismal summer but remain well short of healthy levels. (AP Photo/Amy Sancetta)
AP
In this Sept. 22, 2010 photo, an existing home is seen for sale in Bainbridge Twp., Ohio. Sales of previously occupied homes rose last month after a dismal summer but remain well short of healthy levels. (AP Photo/Amy Sancetta)

SOUTH PORTLAND, Maine — A real estate group says sales of existing single-family homes in Maine fell 21 percent last month from a year ago – slightly worse than the national trend – while the median sales price inched up slightly.

The Maine Real Estate Information System said real estate agents sold 899 homes last month, down from 1,139 in September 2009. The median sales price statewide rose 1.7 percent, to $169,900.

For the three-month period from July through September, homes in Cumberland County had the highest median sales price of $230,000. Piscataquis County had the lowest median home price, at $85,000.

Nationally last month, sales of existing homes jumped 10 percent from the previous month to a seasonally adjusted rate of 4.53 million, the National Association of Realtors reported Monday. Sales are down about 19 percent from September 2009.

Buying activity rose in every region of the country from August to September, led by a 14.5 percent increase in the Midwest. Sales jumped for all housing types, including single-family homes, condominiums and townhouses, the group reported.

But the national median price for existing homes fell 2.4 percent from a year ago to $171,700 in September.

The boost in September sales was the strongest monthly gain in nearly 28 years, aided by record-low interest rates, which hit 4.3 percent on average in September for a 30-year fixed-rate mortgage.

But the group warned of choppy times ahead because of the recent foreclosure moratoriums put in place by several lenders in response to widespread reports of foreclosure paperwork errors.

Paul Dales, an economist at Capital Economics, said he does not expect a “real recovery” soon, even though sales of existing homes have risen 18 percent nationally in just two months.

“Such gains are only possible because sales had fallen so far,” Dales said in a note to clients. Sales are still 22 percent below April’s peak of 5.79 million, when buyers were rushing to take advantage of a lucrative federal tax credit that has since expired, he said.

The current freeze in foreclosure activity could depress home sales in October, given that foreclosures made up 35 percent of September’s sales activity, Dales said.

“Even if sales on just 15 percent of foreclosed homes fall through, that may mean 240,000 fewer foreclosed homes are sold in October,” he said.

Further weighing down sales for at least three years is the poor economic climate and high unemployment, Dales said.

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