Portland condo sales push to new records

File Photo / Maureen Milliken Tom Landry says Portland's condominium market is on track to break all previous sales records.

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By Jessica Hall

Portland's condominium market hit a record in August with the highest sale price ever, nearly $3.7 million, for a property on Commercial Street.

The sale came amid soaring prices overall, fewer listings and growing pressures from the pandemic throughout Maine’s housing market, said Benchmark Real Estate owner Tom Landry. And this year is on track to surpass all previous condo sales records, including the number of sales, highest price, and highest price per square foot.

Like other segments of the residential market, condo price increases are driven by an imbalance between supply and demand, Landry said. Inventory is down mostly because new condo development has lagged.

“There are very few new condo projects in the planning stages, let alone taking reservations right now,” said Landry.

When the pandemic hit, very few investors and lenders were willing to bet on condos, he added.

“They saw people fleeing larger, multi-tenant buildings for single families in the suburbs and rural areas. This immediately put a pause on many new projects,” Landry said.

The lingering pandemic also has caused some potential sellers to stay put, while at the same time more buyers from larger metropolitan areas want to move to Portland. Some buyers from western states also cited fires and droughts as motivation to move.

That imbalance, as well as supply chain interruptions that have driven up the costs of building materials and caused delays, have added to pressures on the market. Landry also said a slower permitting process in Portland, new zoning regulations and the high price of land have together prompted some developers to pause their projects, move outside the city, or give up.

So far in 2021, there have been 33 condo sales over $1 million, compared with 10 deals last year. This year has seven sales over $2 million.

Previously, there had only been one condo that sold for more than $2 million. A condo on Fore Street sold for $2.05 million in 2019 and was resold in 2021 for $3.2 million. With this month’s record deal, there have been two sales over $3 million for the first time ever.

The median sale price for condos this year was $358,0000, up only 1% from last year.

The statistics were prepared by Benchmark Real Estate using data from Maine Listings.