Lewiston-Auburn’s multifamily home market remains hot, with prices rising sharply as other locations around the state show signs of cooling.
The median sales price in the Lewiston-Auburn area rose 85 percent from roughly $150,000 to $280,000 between 2019 and 2022, Brit Vitalius, broker at Vitalius Real Estate in Portland, told the 800 attendees at the MEREDA annual real estate forecast conference in Portland on Thursday.
Despite having the fastest growth among Maine’s largest cities, those prices are a bargain compared with the 47 percent multifamily home median sales price rise over the four years to $750,000 in Portland. Neighboring Westbrook and Saco-Biddeford also saw strong price rises at 70 percent to $525,000 and 64 percent to $475,000, respectively.
The multifamily market was at a peak in 2021 in terms of activity, Vitalius said, but prices in most Maine cities have returned to the norm before the pandemic and real estate surge.
The exception is Lewiston-Auburn. In 2008, the year before the market bottomed, there were 200 multifamily homes listed for sale in Lewiston-Auburn. Today there are 16.
“We’ve come a long way in Lewiston-Auburn, where there is a lot of change and development happening,” Vitalius said.
Those changes are attracting national attention. Discourse magazine last year called Auburn the “YIMBYest city in America” for being open to development and attracting more residents. A Cato Institute podcast highlighted its housing turnaround. And the Better Cities Project wrote a case study about how Auburn won incremental victories to increase housing with zoning reforms led by Mayor Jason Levesque.
Investors are looking outside of Portland to buy multifamily homes because of that city’s stringent rent control, Vitalius said. Even with the slower price rises for multifamily homes in most Maine cities, he expects a good year for sales in 2023.
Prices in Lewiston-Auburn’s multifamily home market should start to level off over the next two years, following the other cities, said Frank Carr, senior vice president at Maine Realty Advisors, who covers central Maine. And that should translate into some breaks for renters of those units.
“The prices will level off and the rents, which are rising rapidly right now, will start to level off,” he said.
Single-family homes also are rising sharply in Lewiston, up 70 percent over the last five years to $265,000 in 2022, Dava Davin, founder of Portside Realty, said. Still, with few homes for sale, the rate of increasing prices will slow there and throughout the state.
“Housing prices will level off, but they won’t decrease because of tight inventories,” she said.