Housing inventory bottomed out in January 2022. While inventory is up 35% since January, homes for sale are still below normal and favors sellers. Inventory supply is expected to continue to increase through the next 12 months.
Home prices have skyrocketed since the onset of Covid. Prices peaked in June 2022. We expect prices to flatten out over the next 12 months. The value of the U.S. Dollar is less and demand has cooled.
New building permits have cooled since January, but remain strong. Building permits are now at 2006 levels and could bounce back slightly in the next 12 months. Lack of inventory supports more building permits. Also, current inflation could cool the demand for building materials and lower prices. We expect new builds to continue to cool slightly through 2022.
Rising mortgage rates, inflation and market uncertainty have caused existing home sales to plummet 26% since January. We expect home sales to rebound slightly in the coming months. However, higher interest rates means less money being lent by banks, which also means less buyer demand.
Bottom Line: Real estate is historically one of the safest long term investments and can also mean many tax benefits for the owner. Sellers should be up to date on the current market and price their properties accordingly. Buyers may also benefit from some of the best opportunities in years to purchase. Are you curious about the Maine real estate market? Give broker Brandon Pomerleau a call at 207-890-1361.