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Dear Friends,
Many think September is the best month of the year in Maine and this one did not disappoint. Capping a near perfect summer, the September weather was truly spectacular with several bright, crisp, clear, sunny days!On the economic front September was also a strong month for both hard assets and financial assets, yet we are left with mixed signals as to the directions of the marketplace for stocks, bonds, gold, currencies and real estate.
Gold prices are at an all time high above $1,300 per oz. The 10-year government note is currently yielding a seemingly unsustainable low 2.50% +/-. The Swiss Franc is near par at 98 cents (US) for one Franc. Low interest rates, a solid Swiss Franc and strong gold prices tend to be very defensive instruments sought by investors looking to brace for a tumultuous future. Yet the Dow Jones Industrial average has rallied nearly 8% since our newsletter was penned last month.That is clearly a sign of optimism for the US economy. As is typical of our efficient markets, they are awaiting further clarity on the November elections and the economic implications of current and pending tax legislation before committing to the bull camp or the bear camp. That said, it is still a bit unsettling to see both bullish and bearish investments rally in unison. I do believe is why we are experiencing many new buyers coming in to the real estate at the moment.
As for Maine Real Estate, the headlines continue to be disappointing when comparing sales volume figures to the tax driven frenzy of a year ago with the "First Time Homebuyer " tax credit in full swing. Data released last week by the Maine Association of Realtors reported a decline of 9.5% in unit sales volume for all single family homes.Despite disappointing results for August, it was substantially more encouraging than the 30% decline reported for the 12 month period ending July 31.I am somewhat comforted by evidence that the market is returning to a more normalized level of activity.The August data did reveal that the median home sale price increased by more than 4% compared to last year. Although this is good news as we continue to recover from the very depressed prices of 2009, we will need steady to improving sales volume to keep prices moving in a positive direction.
It is interesting to note that segments of the Maine real estate market tend to perform more like defensive financial instruments such as Gold and Swiss Franc. The low interest rates offered by Treasury notes have fueled very low yielding mortgage rates which enhance the buying power for prospective real estate buyers. The segments that seem to have benefited most from these dynamics are the middle market, luxury property and second home sectors. When the stock market is a "sure bet" to keep going higher, most asset buyers will simply keep their money in stocks. Maine real estate is looking like more of a safe haven than some other investment alternatives. Of course, we have been constantly reminded that there is no such thing as a "sure bet."
Our August newsletter titled "The Sky is Falling"first identified a resurgence in the middle market and luxury sectors. We are pleased to note that Legacy Properties Sotheby's International Realty capitalized on this revival with several new high value property contracts in August and September.Our current portfolio of pending home sales has migrated from 30 sides (Buyer and/or Seller representation) averaging over $665,000 in August to 40 sides averaging just under $1,000,000 per property. This is an extraordinary feat that is the culmination of broad based marketing of some of the finest homes on the Eastern seaboard. The highlights include a sample of our current pendings above $500,000: |
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In closing, it is important to note that most of the recent high value pending home sales above were homes listed by an agent at Legacy Properties Sotheby's International Realty. And in many cases, an agent we were able to find a suitable buyer as well. They were marketed all over the world in terms of print and/or internet advertising with our many luxury property partners. And most importantly, we will work to get them closed.
As we look at October, we see the a reversion to the mean as the order of the day. The "New Norm" with trending improvements in volume and pricing. More buyers, confident that the worst is behind us, will be there for a great property at a fair market price.Sellers have largely realized that although "blue chip" Maine real estate has outperformed "blue chip" stocks, both have suffered a material loss of value in the last 5 years. A growing pool of confident buyers combined with a growing pool of realistic sellers will continue to yield satisfactory results for both parties as we look to the future of Maine real estate.
Kind regards, |
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Spend the Holidays by the ocean. This bold ocean front private residence has a well equipped gourmet kitchen which allows plenty of room for socializing and multiple cooks for your holiday meals. Has formal dining room and more casual kitchen table both with striking views of the Atlantic Ocean. This six bedroom property offers privacy and comfort for your family during the holidays. Bring along another family or your in-laws who can stay on the property yet in their own separate house. All rooms have TV, Internet, and Private Bath.
Relaxing quiet evenings around one of eight fireplaces. Plenty of books, DVDs, and board games. Tree decorations, lights, and stands provided. Can offer daily maid service. Easy access to skiing in Maine, New Hampshire and Massachusetts. One hour from Boston Logan Airport, Manchester New Hampshire Airport, and 30 minutes to Portland, Maine. Also near Kittery Outlet Shopping, Portsmouth, NH, variety of restaurants and entertainment.
Rates:
Also available for the holidays! $14,000/week
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Located 8 miles from Brunswick and walking distance to Cundy's Harbor, a newly constructed majestic home sits on a private peninsula and 2 acres of beautifully wooded land overlooking Casco Bay and its own 270 feet of private beach.
This 3,000 sq. foot retreat faces east allowing the sun to shine upon its beach and grand multi-level deck all day long. Spend your days on the beach sea glass hunting, swimming, playing horseshoes, fishing, kayaking in the cove or to near by islands. Relax with a great book on the screened-in porch overlooking Rogue Island or swing in the hammock while watching the boats pass by.
In the evenings, enjoy a fire in one of the three fireplaces, watch the moon sparkle on the water and listen to the sound of the waves crashing on the shore while preparing a meal on the outdoor grill or in the gourmet kitchen.
There are three bedrooms, two full bathrooms and a private outdoor shower. The master-bedroom suite features a sitting room with fireplace and surround sound home theatre system. The master-bath has a twin shower and oversized soaking tub. "Seaglass Cottage" with its amenities and atmosphere are certain to create memories to last a lifetime.
Rates:
Also available on a long-term rental basis for $6,000/month
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Looking for a vacation rental that caters to your whole family? Look no further! Sea View sits on one the few sandy beaches on Maine's Coastal Waters. This home's décor is unmatched and the level of comfort it affords is unsurpassed. This gorgeous property offers 6 bedrooms and a separate carriage house that offer incomparable opportunities for relaxation. Sea View boasts a 12 person theater room, arcade room, billiards room, poker room and exercise room. The flow of the compound makes family gathering easier than ever with an open floor plan and unique places for each guest to relax.
The beach is only steps from the front door and greets you with picturesque scenery and ever changing views for miles. After building sandcastles and playtime outside, rinse off with the outdoor shower before heading inside.
Sea View is 25 minutes from Portland and 5 Minutes from the popular Old Orchard Beach Community.
Rates: $12,000/week |
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The Maine Inn Brokerage Team of Legacy Properties Sotheby's International Realty was initiated a little over a year and a half ago. The team is made up of 4 seasoned professionals with experience in both the Real Estate business and facets of the hospitality business. In this very short time, Maine Inn Brokerage has grown to our current portfolio of 27 existing Inn/B&B and potential Inn/B&B properties. We are very proud to have listed some of the best-known properties in the state. Legacy Properties SIR has become the statewide leader in residential luxury properties while the Maine Inn Brokerage Team enjoyed moving toward the leadership position within the Inn/B&B market. Please watch this monthly column for happenings in the Maine Innkeeping world.
If you or anyone you know would like further information on Maine Inn Brokerage, please join our E-Newsletter mailing list by contacting Don@MaineInnBroker.com.
Please find all of our Inn/B&B listings on www.LegacySIR.com
The following are a sampling of our current statewide listings. |
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E F F E C T I V E P R I C I N G
10 Points to Consider when Pricing your Home
- Markets are efficient. Competitively priced properties sell. Overpriced properties remain on the market.
- In an Internet driven world you can often determine "market value" in days or months. The print driven world required months or years to reach a comparable number of buyers.
- Properties priced at market typically go under contract within 30 to 90 days. Your specific result is influenced by price, location and market depth.
- Properties priced above market are often on the market two to three times longer than well priced comparables.
- The ratio of listing price to selling price declines as time on market increases.
- Value is tied to the benefit a property provides rather than the cost to provide the benefit.
- Buyers will not pay more for a property if there is another that is a reasonable substitute.
- There is seldom a relationship between "your cost" and market value. A difficult concept even for the most financially sophisticated.
- What a seller "needs to net" or what a buyer "can afford to pay", does not define market value.
- Testing the market is expensive. Testing means looking for a buyer who will pay more than "market value". You can spend a lot of time [days on market/price revisions/opportunity cost of losing the first buyer] looking for a buyer who will pay more than market value.
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