Maine home sales plunge 28 percent May-over-May|
The number of existing home sales in May dropped 28 percent compared to the same period last year, according to a Wednesday release from the Maine Association of Realtors.
The median sales price also dropped slightly May-over-May, from $169,900 to $165,700, a 2.47 percent drop.
The group reported that there were 784 units sold statewide in May, compared to 1,090 last year. Mike LePage, a Realtor with RE/MAX Heritage in Yarmouth and the president of the Maine Association of Realtors, said part of the reason for the year-over-year drop was a boost in May 2010 sales due to expiring tax credits.
“As we compare and contrast last year, we are reminded that second quarter last year marked a modest surge in the market due to first time and second time homeowner tax incentives that carried through the end of June last year,” LePage said in the release. “That boost may be the challenge we see as we attempt to compare last year’s first half of the year market to 2011.”
Angelia Levesque, president of the Bangor Board of Realtors, agreed with LePage’s assessment.
“We’re probably going to have another month or two of these wacky numbers, until we can get through into the third quarter, where we’re going to be apples to apples,” Levesque told the Bangor Daily News. “Then we’re going to have a good idea of where this market is.”
The May numbers were a slight boost from April, which saw 758 homes sold statewide and a median sales price of $160,750.
Looking back at historic May numbers for Maine, there were 1,106 homes sold statewide in May 2007, and 969 in May 2008. The median sales price in May 2007 was 193,000, dropping by $11,000 the following May.
The current market remains good for home buyers, Levesque noted. And home sellers can move their properties, if the price is right.
“I’m seeing homes that if they’re price correctly, they’re selling,” she said.
Levesque said she is also seeing the second-home market beginning to move again, and has seen some interest in coastal properties.
Maine’s May numbers reflected national trends. According to numbers from the National Association of Realtors, existing home sales nationwide dropped 15.3 percent May-over-May. They dropped 3.8 percent from April, however, while Maine’s numbers rose slightly over last month.
NAR chief economist Lawrence Yun pointed to a number of factors that led to May’s decline.
“Spiking gasoline prices along with widespread severe weather hurt house shopping in April, leading to soft figures for actual closings in May,” Yun said in a Tuesday statement. “Current housing market activity indicates a very slow pace of broader economic activity, but recent reversals in oil prices are likely to mitigate the impact going forward. The pace of sales activity in the second half of the year is expected to be stronger than the first half, and will be much stronger than the second half of last year.”
He also suggested that the lending community’s “overly restrictive loan underwriting standards” were slowing down the housing market.
The NAR pointed to Freddie Mac numbers showing average mortgage rates for a 30-year fixed loan was 4.6 percent in May, down slightly from April and down from 4.89 percent in May 2010.
“Although low mortgage interest rates are welcome, they are less meaningful compared to the tightness of loan underwriting standards,” Yun said.
The Maine Association of Realtors also released numbers comparing last year’s March 1 to May 31 period to this year’s quarter. All counties saw a drop in the overall number of homes sold except for Washington, which saw a 33.33% increase. That represented an increase of four homes sold; from 12 in the 2010 quarter to 16 this year.
The most precipitous year-over-year drops for the quarter were in Sagadahoc (41.58 percent drop, from 101 homes to 59 homes sold), Lincoln (37.31 percent, from 67 homes sold to 42), and Penobscot counties (35.84 percent, from 332 homes sold to 213).
Looking at median sales prices for the quarter, the numbers dropped in all counties except for Cumberland, Franklin, Kennebec, Oxford, Sagadahoc and Somerset. The biggest gain was in Franklin County, which saw a 13.78 percent increase in the median sales price.
The biggest drop in median sales price statewide was in Waldo County, which saw a 14.49 percent drop in the quarter.