A September report published by a state-level advisory committee argues that Maine must “incrementally increase the number of housing units it produces per year” in order to reach its production goals by 2030.
Following up on the 2023 State of Maine Housing Production Needs Study, this report represents the work of an advisory committee formed by the Department of Economic and Community Development (DECD) to “create statewide and regional goals.”
In addition to outlining specific housing production goals — both at the statewide and county level — the report also details a number of specific strategies for increasing housing production over the next few years.
The group explains that the goals outlined in this report are not “mandatory requirements” and will be “reexamined and adjusted” over the next few years.
According to economic data tracked by the Federal Reserve Bank of St. Louis, the housing situation in Maine has never been so dire. The data shows that the rental vacancy rate — that is, the number of units available for rent — is lower than at any time since 1986, which is as far back as the data go.
The number of houses listed for sale has also declined drastically since 2016. In that year, there were nearly 14,000 homes listed for sale; as of August, just 4,330 homes were listed for sale.
Although the number of active listings has increased slightly since earlier this year, the average home price has continued to skyrocket, meaning even those homes that do enter the market are often not available to the average Mainer. According to the house price index, which is calculated by the U.S. Federal Housing Finance Agency, the price of homes in Maine has never been more expensive than now.
2023’s Housing Production Needs Study Revealed that Maine will need roughly 38,500 housing units to “remedy historic underproduction,” as well as an additional 37,900 to 45,800 units to meet future needs by 2030, for a total of 76,400 to 84,300 homes over the next few years.
The advisory committee recommends achieving the goal of increasing the available housing supply by “gradually” increasing the number of housing units produced annually over the next few years.
The report goes on to break these production goals down by county, some of which are expected to need significantly more housing than others.
The Advisory Committee explains that while it decided against dedicating a percentage of these production goals to affordable housing in particular, it did “emphasize the need for affordable housing production for low- and moderate-income households.”
The report goes on to suggest numerous strategies for meeting the housing production goals outlined throughout the earlier section that are designed to serve “as a starting point” for “reduc[ing] existing barriers” to increased housing construction.
For example, they recommend “invest[ing] in infrastructure development and maintenance” in order to “shift connection costs” away from households, facilitating “networking and educational opportunities” for developers and municipalities, and “invest[ing] in strategies to increase Maine’s home building workforce.”
They also suggested “facilitat[ing] conversations to shift local attitudes about affordable housing development.”
“Often this opposition is based on stereotypes about the type of people that will be living in the housing and concerns about changing the character of the existing neighborhood,” the report said.
Another strategy laid out in the report is establishing an “on-going sustainable source of funding for affordable housing,” including through the “strategic use” of federal funding.
The report also focused on local building and land use regulations, suggesting that they be “reduce[d] and streamline[d]” so as to not “unnecessarily restrict housing or increase the time and costs of construction,” pointing toward LD 2003 as a “substantial step” in this direction.
LD 2003 — an affordable housing bill approved by the Legislature in 2022 — imposed a number of one-size fits-all requirements on municipalities statewide with the stated goal of increasing the availability of affordable housing.
The committee also suggests “streamlin[ing]” state-level laws and regulations because “overly burdensome regulations can increase the time and costs of building housing units.”
“To decrease housing costs, review of state level regulations must be undertaken to reduce and streamline the unintended or negative consequences of complex regulations to allow timely, cost-effective, and safe construction of homes,” the report reads.
Other miscellaneous recommendations include incentivizing a focus on “in-state manufacturing methods and state natural resources,” as well as increasing “staffing and training opportunities” to help account for the increased demand in housing construction.
Click Here to Read the Full Report
This past spring, the Maine State Housing Authority announced that it would be awarding $30 million in state subsidies for the development of affordable housing throughout the state.
This funding will be spread across six different localities — including Augusta, Bangor, Gardiner, Lewiston, Scarborough, and Waterville — and allow for the construction of 248 new housing units.
MaineHousing said in their press release that funding for these subsidies was “made possible” by a $17.5 million allocation made by the Legislature during the first session, as well as a $10 million allocation made as part of the recently approved supplemental budget.
Three of the developments receiving a subsidy are targeted at older adults, while the other three are geared toward families.
According to a recent report from the Maine Association of Realtors, home sales in Maine have decreased by more than 10 percent since June of 2023, while prices have increased by nearly 5.5 percent.
With a total of 1,291 homes sold this June, sales are down by nearly 150 compared to 2023, when 1,435 home sales were completed.
A new poll from Pan Atlantic Research — a Portland-based independent marketing research and consulting firm — revealed in September that a substantial portion of Mainers feel that the state is on the wrong track, citing the cost of living, housing, and high taxes as their primary concerns.
Similar to the results of an August poll conducted by the University of New Hampshire, Pan Atlantic Research found that over 40 percent of Mainers feel that the state is on the wrong track.
When asked to identify the top three issues facing the state today, the most common response was the cost of living, noted by 67 percent of respondents.
This was closely followed by housing at 37 percent, and high taxes at 28 percent, which nearly tied with inflation.
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