Housing
This section of the BDN aims to help readers understand Maine’s housing crisis, the volatile real estate market and the public policy behind them. Read more Housing coverage here.
One of Maine’s most expensive homes for sale has been relisted twice in the last year, each time with a multimillion-dollar price cut.
The large beachfront estate on 4.3 acres in the wealthy Prouts Neck neighborhood of Scarborough is now going for $9.5 million after being listed last February at the eye-popping price of nearly $13 million, a rarefied point in Maine’s luxury market.
Those price adjustments don’t mean Maine’s luxury real estate market is flagging. In fact, it’s something real estate agents say they’re doing to be more competitive with the rest of the market as more homes are listed over $2 million, something that was uncommon before the COVID-19 pandemic.
“We’ve seen some price reductions for sure, but you have to remember that at the very high end of the market, there’s a limited buyer pool,” said Elise Kiely of Legacy Properties Sotheby’s International Realty, the listing agent for the Prouts Neck home.
The pandemic saw Maine home prices and values skyrocket in a few short years as a wave of new residents settled here, competing for low housing inventory. That squeeze has hit housing inventory affordable to low- and middle-income earners hardest, but it’s also reverberated into the luxury market, Kiely said.
“High-end” properties in Maine is a term that once applied to homes going for $1 million. Now, Kiely said “high-end” is considered at least $2 million. On Tuesday, there were 171 properties for sale in Maine going for at least that much, and a large chunk of them have seen price cuts in the last two years.
That sum is a ton for almost all Mainers, but it is not to luxury buyers assessing the regional market. In fact, it’s actually inviting, because Maine is the cheapest state for high-end properties in New England, and probably the nation, David Jones, broker-owner of F. O. Bailey Real Estate, said.
“All properties seem to have doubled in price. We’re still not where [other states] are,” Jones said, adding that many of these buyers can sell the multimillion-dollar homes they already have in order to buy new ones in Maine.
That’s a small pool of buyers to compete for, though they’re increasingly inclined to come to Maine for its lower prices over other coastal states like New Hampshire, Massachusetts and Rhode Island.
While price adjustments can happen for any number of reasons — like a seller overvaluing their home, looking to sell quickly because of a life change or anxiety over the economy — Maine agents say more high-end inventory is causing them to recommend their sellers lower prices to stand out to monied buyers.
That’s what Steve Shelton, a broker with Better Homes & Gardens Real Estate/The Masiello Group based in Bar Harbor, recently advised the owner of a home he’s trying to sell for $7.4 million when he saw a comparable property on the market going for the same price. The property started out at $8.9 million when it was listed five years ago, he said.
“I do tell my seller about that and tell them that they should adjust, but they usually don’t,” Shelton said. “They can usually afford to do what they want to do in that price range.”