Will 2025 Finally Be the Year for Maine Home Buyers?

Maine homebuyers have had a rough few years—there’s no sugarcoating it. Skyrocketing interest rates and a severe lack of inventory have pushed many potential buyers out of the market, leaving them stuck renting instead of buying.

For some long-term renters, the silver lining is that they’re often locked into leases with below-market rent and some of the lucky ones renting month-to-month with landlords keeping their rent the same, or close to it. But that’s not the case for everyone. 

Landlords across Maine have hiked rents for many tenants, leaving some struggling to keep up. And if you’re trying to move into a new rental, good luck—that same inventory problem is driving rental costs through the roof. It’s a vicious cycle: you can’t afford to buy, and renting is barely an option.

So, What’s the Forecast for 2025?

The good news? Mortgage rates have had little drops here and there and are projected to continue to drop this year. The bad news? Not by much. According to Business Insider, analysts were confident that rates may dip below 6% before the end of the year. As a local realtor here in Southern Maine, I’ve heard similar optimism from mortgage lenders, some even suggesting rates could hit the low 5s by mid-2025. But recently, the outlook has shifted. At the time of this article, rates are still hovering in the high 6's, not quite the relief we were hoping for.

What About Inventory?

Here’s a glimmer of hope: inventory is up 40.2%, according to Houzeo. That’s a big deal. More inventory usually means lower prices, and for the first time since the pandemic, median home prices—currently $415,700—are expected to decline. How much will they drop? Well, that’s anyone’s guess. Real estate predictions are about as reliable as Maine weather forecasts in April.

Will the Housing Market Crash in Maine?

Short answer: don’t count on it. Houzeo, along with other experts, also say it’s highly unlikely Maine will see a housing market crash anytime soon.

Final Thoughts

While no one has a crystal ball, 2025 is shaping up to be a slightly less painful year for Maine homebuyers. Mortgage rates might inch down, inventory is climbing, and prices could even soften a bit. Will it be enough to make a real difference? That’s the million-dollar question.