Legacy Properties Sotheby’s International Realty
A 5-bedroom, 6-bathroom home on four acres in Cumberland Foreside is listed for $3.5 million by Legacy Properties Sotheby’s International Realty.
Updated: May 4, 2023
A Maine broker says home buyers are looking further afield for the right place
File photo / Tim Greenway
Chris Lynch, owner and president of Legacy Properties Sotheby’s International Realty, outside a Cape Elizabeth home his firm listed for $5.5 million.
With inventory tight and prices still near peak levels, buyers are "broadening [their] geographic scope when searching for homes," according to one broker's report.
Legacy Properties Sotheby’s International Realty says demand has expanded "north and west of our traditional markets" in southern Maine.
The brokerage added specialists in lake properties, hunting and fishing camps and skiing locations, in addition to its traditional markets, the brokerage said in its most recent market analysis.
"The backdrop in today’s market is certainly more healthy for both buyers and sellers than at any time since the onset of the COVID-19 pandemic," writes Chris Lynch, who writes the market analysis and owns Legacy Properties Sotheby's International Realty in Portland.
Lynch, whose team includes 100 agents, told Mainebiz he sees the interest going in concentric circles, not just from Portland but from markets elsewhere in the state as well.
From Portland, there was a natural growth out to Scarborough, Cape Elizabeth, Yarmouth and Freeport. But now potential buyers are beating the bushes in Buxton, Poland, Lisbon, to name a few places.
"So if you look at Camden, you see [buyers] going to Union and Appleton," Lynch said.
In Whitefield, a town of 2,408 people in Lincoln County, Lynch said his firm had a house with 12 bidders.
Still seeing cash buyers, with a caveat
Legacy Properties has properties at all levels, but half of its sales are homes that sell for more than $1 million.
"The higher the price, the more likely it is to be a cash buyer," Lynch said..
But he makes an interesting distinction.
We heard throughout the pandemic about cash buyers winning bidding wars. They were, Lynch said, but they often came to the closing with a bank check.
During COVID and before interest rates went up, buyers often used cash for leverage in getting a house. Then, after talking it over with their accountant or financial planner, they'd often realize they'd be better off getting a loan at a low interest rate than selling stock or other equities and incurring capital gains costs.
"Now it's going back the other way, where cash buyers are now paying cash," Lynch said.
Numbers down, but inventory is tight
The Maine Association of Realtors said the number of homes sold in March fell by nearly 17% and cited higher interest rates and tight inventory. The median home price has been stable, and is actually 3.85% above March 2022.
The National Association of Realtors reported that March sales were down more than 20% across the country, with median home sale prices dipping by 1.4%.
Legacy Properties Sotheby's said Maine has traditionally been more resilient when it comes to price declines.
Lynch characterizes Maine as a market with an abundance of "downsizers," with retirees selling the house where they raised a family and moving into something more manageable. Often they're buying a second house or condo in Florida, Arizona or another Sun Belt destination.
While inflation, the money supply, interest rates, and state and federal programs will be factors to consider, Maine is well positioned.
Lynch said there's still a good deal of demand for houses. He's not as worried about downward real estate trends.
"Real estate [trends] tend to start in California and move east to New York City. They'll come up to Boston and Portsmouth [N.H.], but they don't always make it to Maine," Lynch said. "We sometimes miss whole cycles."
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