Housing production of all types is underway across Maine, but affordability remains the dominant issue in the market, as the state’s median income fails to keep pace with housing prices, according to a MaineHousing report, “Maine’s Housing Outlook,” published earlier this month.
From 2015 through 2024, Maine’s median income increased by 44%, “while the income needed to afford the median priced home increased a whopping 187%,” the report says.
The rental market fared no better.
“Despite MaineHousing’s record success in 2025 with its first-time homebuyer program, the demand from homebuyers continues to outstrip the supply of homes for sale,” the report says.
Price pressures
Year-over-year price increases were lower than in the recent past, but supply is a problem, at least until interest rates tick down, the report says.
Sources of price pressure for single-family homes include buyers with larger homebuying budgets, such as telecommuters and retirees who moved to Maine for its attractive lifestyle and location.
Another problem tied to affordability has been continued pressure around homelessness and strains on related social services.
“While the number of persons experiencing homelessness in Maine may have moved closer to pre-pandemic levels, the network of organizations charged with assisting this population is worn out from years of underfunding,” the report says.
Housing starts
The report suggests that housing production is one key to solving the problem.
“Maine has a well-articulated goal to increase housing production at all levels, both market-rate and subsidized,” the report says.
MaineHousing’s affordable housing production is “well above” historical averages, with 755 low and middle-income units coming online in 2025, and a record future production pipeline extending through the next few years.
The first accounting of the number of new housing builds across the state is taking shape, in response to a push to meet Maine’s need for 84,000 more homes by 2030.
Cloudy picture
But complexities, the report says, include unpredictable federal policy, demographic trends affecting the construction workforce and persistent high costs for construction, which “all cloud what in general is a positive outlook for production.”
Still, the new year shows evidence of progress on several fronts. Affordable housing construction is on a positive swing. A total of 755 units were completed in 2025 and another 1,209 are under construction, with 826 expedited to be ready for occupancy by the end of the year
However, production costs have risen steadily over recent years, although the trend has slowed and might begin to stabilize in 2026 and 2027, the report says.
Mortgage rates
On the homeownership front, 30-year fixed-rate mortgages, a primary determinant of homebuying activity, are largely natural or even positive, with market-rate loans maintaining a 6-7% range since late 2022 and MaineHousing’s first-home loan program offering rates below the market average.
But rising home prices continue to be a primary concern for homeownership access. From 2020 to 2025, the median home price grew by more than 36% while wages and salaries grew by less than 27%.
“In the face of these trends, it is unsurprising to hear Maine households reporting that the dream of homeownership feels out of reach for them,” the report says.
Cost burden
Since 2018, rental cost burden has increased sharply among Maine households earning between $35,000 and $75,000 in total household income. A household that spends more than 30% of gross household income on housing costs is considered to be cost burdened.
“Such a household necessarily has very little income remaining to cover other necessities, much less any savings, or funds for discretionary spending,” the report says.
Rental cost burden has increased across all income brackets, but the most notable changes occurred for Mainers earning between $35,000 and $75,000 in total income.
Homelessness remains a concern: The average length of shelter stays steadily increased for three consecutive years, reaching 150 days in 2025.
“It reflects not only the individuals’ willingness to remain in the shelter, but the difficulty of finding viable housing solutions for people experiencing homelessness,” the report says.