Maine is set to see some of the nation’s biggest home price hikes
Sue, a Bangor Daily News reader, asked recently about long-range predictions for Maine home values.
They are expected to rise everywhere over the next year, according to data from Zillow. One area of Maine is expected to see one of the biggest jumps in the country, and it might surprise you.
The big picture
Average home values are expected to increase by 4.7 percent or more in more than 140 Maine towns and cities by August next year, according to housing data from Zillow. Lack of supply was the biggest factor cited in the housing affordability crisis here in a state report released last week that calls for nearly doubling production through 2030.
The real estate site’s projections for home prices only go out a year for specific areas. Overall, Goldman Sachs is slightly bearish on the U.S. market in the ensuing years, expecting minimal growth through 2026 in a recent report.
But the recent growth in the market has put homes out of reach for many. The average Maine home value is nearly $390,000 now, Zillow says. Under default terms, the site’s affordability calculator says you need to make $109,000 to comfortably buy a home at that price. Maine’s median household income last year was $75,000, according to federal data.
Hikes in the capital area
The largest increases will hit the Augusta-Waterville area, where Zillow predicts values will rise 9.1 percent in the next year. That increase would be the 11th highest in Census areas across the nation, according to the site.
In April, that annual increase was projected to be 7.7 percent. Supply and high interest rates locking people into their homes have been major factors. A real estate agent said there were only 14 homes put on the market in the capital area in the entire month of April.
The Maine region that will see the next-highest increase in home values will be the Lewiston metropolitan area, Zillow predicts, at 7.9 percent. The Portland metropolitan area might see home values rise by 7 percent by August, and values in the Bangor metropolitan area are expected to climb 6.9 percent in that time.
In Portland, the average home was valued at $529,220 in August. Zillow forecasts that that will have increased to $543,509 by the end of November, and $567,853 by August next year. That is a $38,633 increase in a year.
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