Demand for single-family housing drove home sales across Maine in May, pushing closings up for the fourth consecutive month and the median sale price up 7.06% to $398,250, far surpassing the previous record of $385,000 set one year ago, according to the Maine Association of Realtors.

Realtors reported 1,180 homes changed hands last month, up 3.96% from the previous year, with half of the homes selling for more than $398,250 and half selling for less, based on Maine Listings data. The previous price record was set in June 2023, reflecting the usual summer spike in home sales.

Buyers also had a bit more inventory to choose from last month, with 3,896 homes for sale – the highest number since August 2022 and the second-highest since September 2021, said Paul McKee, association president and a broker affiliated with Keller Williams Realty in Portland.

“Sellers have become more active in 2024,” McKee said in a statement. “With more homes for sale, more transactions are happening.”

But while some markets across Maine are seeing more options and some flexibility in negotiations, others continue to grapple with light inventory, multiple offers and pressure on pricing, McKee said.

“We’re starting to see signs of a more balanced market,” said Dava Davin, founder and owner of Portside Real Estate Group, which has offices throughout southern Maine. “We’re seeing some softening, but it’s really hyper local. It really depends on the town and even the neighborhood.”

In Maine’s most expensive regions, median home prices continued to edge up during the last three months, from $536,500 to $570,000 (6.24%) in Cumberland County; from $476,388 to $508,500 (6.74%) in York County; from $450,000 to $475,000 (5.56%) in Knox County; and from $380,000 to $434,750 (14.41%) in Sagadahoc County.

Significant three-month price gains also were recorded in Waldo County, $305,000 to $377,750 (23.85%); Androscoggin County, $303,500 to $329,000 (8.40%); Penobscot County, $249,900 to $276,000 (10.44%); Franklin County, $247,000 to $294,950 (19.41%); and Piscataquis County, $181,000 to $236,500 (30.66%).

The number of home sales increased in most of Maine’s 16 counties over the last three months, except for Aroostook (-16.46%), Cumberland (-2.35%), Kennebec (-4.94%), Sagadahoc (-1.37%), Somerset (-15.89%) and Washington (-10.13%).

Nationally, the number of existing-home sales fell slightly for the third month in a row, down 0.7% from April, and down 2.8% from one year ago, according to the National Association of Realtors.

At the same time, the median sale price climbed 5.8% from last May to a record $419,300, the highest price ever recorded and the 11th consecutive month of year-over-year price gains. The previous high mark was $396,500 one year ago.

The number of sales declined month-over-month in the South but were unchanged in the Northeast, Midwest and West. Year-over-year, sales rose in the Midwest but receded in the Northeast, South and West. All four regions registered price gains.

Lawrence Yun, chief economist with the national association, said the new high in home prices is forging a wider divide between those who own properties and those who want to be first-time buyers.

“The mortgage payment for a typical home today is more than double that of homes purchased before 2020,” Yun said in a statement. “Still, first-time buyers in the market understand the long-term benefits of owning.”

Total existing-home sales – including single-family homes, townhouses, condominiums and co-ops – dropped 0.7% from April to a seasonally adjusted annual rate of 4.11 million completed transactions in May, the national association reported. Year-over-year, sales waned 2.8%, down from 4.23 million in May 2023.

The inventory of unsold existing homes grew 6.7% from the previous month to 1.28 million – and up 18.5% from 1.08 million one year ago.

Yun predicted that increasing inventory will help boost home sales and tame home price gains in the coming months.

“Increased housing supply spells good news for consumers who want to see more properties before making purchasing decisions,” Yun said.

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