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November 30, 2023

Sale of 3-bedroom home in Falmouth illustrates Maine's still-pricey home market

Courtesy / Zillow A three-bedroom house with a water view on Falmouth Foreside sold for $1.425 million.

The sale of a three-bedroom "cottage" in Falmouth Foreside shows that Maine's housing market, though cooler, can still command high prices.

The house, at 36 Old Mill Road, sold for $1.425 million, according to Benchmark Real Estate, which brokered the sale.

The home, which dates to 1920 and was refreshed this year, has views of Casco Bay from nearly every room. It has three bedrooms, three full bathrooms, two primary suites, a "chef-inspired" kitchen and exterior features like a firepit, patio area and perennial gardens.

The property includes deeded rights to Muscle Cove beach and dock. Located in a serene and private area, it's only 10 minutes from downtown Portland, which Benchmark said appeals to a buyer "seeking luxury combined with convenience."

The property was assessed at $1.2 million, according to Zillow. The home is 1,789-square-feet and the lot size is 5,227 square feet. 

Maine market getting pricier

Maine's home market has fewer homes available, which has driven up the prices being paid, according to Maine Association of Realtors. 

Maine's median sales price for a home was $376,000 in October, a 13.25% increase from a year earlier. The price rose even as the number of homes sold dropped by 10.14%, to 1,435 for the month, according to Maine Listings. 

The median sales price peaked in June, when it was $385,000. For frame of reference, in 2019, before the start of the pandemic, Maine's median sales price was $225,000. 

Photo / William Hall
In Cumberland Foreside, home of homes with ZIP code 04110, this five-bedroom house sold in July at the area's median price of $1.23 million. The house was built in 1960 by a famed local developer, Robert Walker, and "lovingly updated in recent years," according to the listing.

Cumberland County, which includes Falmouth Foreside, continues to command to be Maine's priciest county, with a median sales price of $549,950 in three months ended Oct. 31, up 10.21% from a year earlier, according to Maine Listings. 

And, as Realtors like to say, it's about "location, location, location."

Cumberland Foreside has Maine's priciest ZIP code and is one of New England's 50 most expensive ZIP codes, with a median home price of $1.23 million, as Mainebiz reported recently. 

Maine has roughly 500 properties listed at $1 million or more, including 28 listed at more than $5 million and four listed at more than $10 million, according to the real estate site Trulia. Overall, there are more than 5,800 properties listed. 

Buyers looking for 'turnkey' properties

Tom Landry, broker-owner of Benchmark Real Estate, which brokered the Falmouth Foreside deal, said location continues to be "the golden rule."

Tom Landry
Courtesy / Benchmark Real Estate
Tom Landry

But, as the pandemic-fueled real estate market shifts to a buyers' market, people are looking for move-in ready homes. He said buyers are still looking to Portland and area towns for plum properties — in some cases, still going through bidding wars.

"People are looking for 'turnkey' homes. They don't want a project. [Many buyers] are moving from outside the market; they don't know anyone here. They don't want to have to hire a contractor. But they may be able to afford $1.2 million or $1.3 million," especially if they sold a house in a pricier market, Landry told Mainebiz.

Markets that might have had pre-pandemic median prices of around $425,000 might have jumped to $700,000 in a two-year period, particularly in areas with highly rated schools and walkable downtowns, he said.

"COVID took a match and some accelerant" to the Maine home market, Landry said. 

Where the market is softening

Portland and surrounding towns are seeing some softening, he said, but values are coming down by 10% after nearly doubling in recent years. 

The $1 million-and-up market is not being as affected as the market around $400,000, which is being affected more by higher interest rates. 

"Buyers could ratchet up when rates were lower. People were 'up-shopping,'" Landry said. 

"We've seen a softening of the middle market. We're transitioning to a buyers' market, but not on everything," he added. "We're still seeing bidding wars on some properties, but others are sitting."

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