Aggressive out-of-town buyers swarm midcoast real estate market

Posted May 17, 2013, at 10:16 p.m.
Last modified May 18, 2013, at 12:35 p.m.

BOOTHBAY, Maine — Kathleen Younger saw a charming house online for sale in East Boothbay. Soon after, the artist traveled from her home in lower Manhattan to see it.

As she walked through the two-bedroom home with sunlight streaming in through large picture windows, Younger was pleased.

“It’s lovely,” she said. “It’s everything I thought and more.”

The next day she made an offer.

In the past year, sales have picked up on the midcoast, making buyers like Younger the new normal.

“The market is on fire,” said Kim Latour, a Realtor with Legacy Properties Sotheby’s International Realty in Brunswick, who showed Younger the $229,000 house with bright interior and hardwood floors.

Younger is typical of the clients Latour is now seeing on the midcoast.

When the market was slow a year and a half ago, buyers could take their time and didn’t feel pressure to put in an offer. Now, they are “action oriented,” Latour said.

“They’re more ready to do something or make a decision quicker than they might have before,” Latour said.

It may not be back to pre-recession levels, but the real estate market in midcoast Maine is booming, according to several Realtors interviewed this week.

“At all levels of the market, we’ve seen pickup in activity,” said Brian Wickenden at Camden Real Estate Co. “Pricing has definitely hit the bottom and midway through last year we saw a surge in buying activity and it’s been an upward trend since then.”

Statistics show double-digit increases in homes sales in Knox, Waldo, Lincoln and Sagadahoc counties in the past four years.

Between the first quarter of 2009 and the first quarter of 2013, Lincoln County experienced a 97 percent increase in sales of single-family existing homes, from 33 to 65; Knox County saw a 51.4 percent increase in home sales, from 37 to 56; Waldo County saw a 45 percent increase, from 40 to 58; and Sagadahoc County saw a 26 percent increase, from 46 to 58, according to data from the Maine Association of Realtors.

Statewide the story is the same. Sales of existing homes in the first quarter of 2013 were up 46.5 percent from the same quarter in 2009, and up 7.7 percent from the same quarter last year, according to the association.

Those increases in the midcoast are likely driven by the market for second homes, or “high-amenity real estate,” according to Charles Colgan, a professor of public policy and management at the University of Southern Maine’s Muskie School of Public Service.

Although he does not have access to the raw data, Colgan said “existing home sales and the rising median sales price is due in good part to high-amenity sales rather than residential sales.”

“But I think non-second home sales and run-of-the-mill average real estate sales are also rising,” Colgan said.

Unlike the past few years, Latour at Legacy Properties has had multiple homes stay on the market less than a week before going under contract. She had one $629,000 Harpswell house go under contract before it officially hit the market. She’s also had several situations where homes have received multiple offers.

“I think that speaks volumes in itself,” Latour said.

The majority of her customers are second-home buyers migrating north from Massachusetts, New York and Connecticut.

Legacy Properties’ Brunswick office has been exploding, according to President Chris Lynch.

Between 2011 and 2012, that office’s sales volume increased 258 percent to more than $50 million, Lynch said.

So promising is the southern midcoast market, Legacy Properties plans to open a second office in the area this summer, Lynch said.

“Our intention is to have a second [southern midcoast] office up and running in June if all goes as expected, and I expect it will,” Lynch said. “That’s a pretty strong statement.”

Legacy Properties, which has four offices along the coast of Maine, also is expecting to reach a milestone soon, Lynch said. The company has a current listing inventory of $247 million, which Lynch says will surpass a quarter of a billion dollars for the first time in the next few weeks.

Even with increases in sales, the consensus among Realtors is that the market is still not a seller’s market.

“Right now we’re still a buyer’s market,” said Paul Gaudette, who has worked as a broker with Coldwell Banker SoundVest Properties in Rockland for the past 16 years. “We’re not seeing a feeding frenzy we saw seven or eight years ago when there was a lot of cash available and people were investing in property.”

It may be close to switching to a seller’s market in tony areas such as Camden, which Gaudette called “its own market within Knox County,” but not on the rest of the midcoast. The entire market is seeing improvement, though, he said.

“The blue collar sections are recovering a little slower, but they are coming along,” said Gaudette, who serves the market from Waldoboro to Belfast.

Bill Crocker, a broker with Newcastle Square Realty in Damariscotta, said over the past several years homes in the $200,000 to $400,000 range, traditionally a tough sell because would-be buyers would have to sell their own homes before considering a new one, are now moving.

“We’re starting to see multiple-offer situations,” he said. “With real estate there’s a lot of pent-up energy. A lot of people didn’t want to sell because they didn’t think they could get a decent price. Now it’s picking up and people are feeling more confident.”

He added: “If I wanted to get in at the bottom of the market I would want to be buying now.”