Mainers faced unusually high heating oil prices, a rise in homelessness and skyrocketing home prices and interest rates in 2022, but there’s hope that volatile markets will stabilize and ongoing statewide relief programs will continue to help ease the burden this year.

That was the message from MaineHousing in a new housing outlook report released Tuesday, which reviewed the state of housing in Maine for 2022 and offered an outlook for 2023.

“Pressures on Maine’s housing market continued in 2022, whether it be runaway inflationary costs, a shortage of available skilled construction workers, or lingering global supply chain kinks from COVID-19,” the report’s authors wrote. “Those focused on increasing housing inventory in the Pine Tree State, like elsewhere in northern New England, had their work cut out for them.”

The report cited MaineHousing data showing an average price of $334,000 for a single-family home in 2022, which is a 13% increase over 2021. 

“The continued rise in price, coupled with rising mortgage rates, making it more difficult to afford a mortgage for households looking to enter homeownership,” the report said.

MaineHousing noted in the report that the department’s First Home Loan program allows the nonprofit to offer loans at lower-than-average rates, and that the program purchased 918 loans for homebuyers in 2022, up from 725 in 2021.

The report also described a rental property market beset by higher interest rates putting pressure on landlords, while labor shortages and supply chain problems led to fewer new construction.

Worse, the federal Emergency Rental Assistance program, started during the pandemic to help prevent people from being evicted, ended in 2022. The report cites data from the State of Maine Judicial Branch showing a 22% increase in eviction filings in 2022 versus 2021, and that the new filings coincide with the program ending. 

“Meant as a temporary program for those facing pandemic-related financial hardships, demand for this one-time federal resource never abated,” the report said.

The report also pointed to high prices for heating oil, noting the average price per gallon had been below $2 in October 2020, and around $3.20 at the beginning of 2022, but would eventually hit a high of $5.71 a gallon in 2022.

“Despite robust and ongoing efforts to convert more homes towards sustainable and renewable heating and energy sources, with more than 60 percent of Maine homes still using a petroleum-based fuel for heat, the state remains at the mercy of the global marketplace,” the report said. 

MaineHousing is still running home heating oil assistance programs paid for by state and federal funding.

Homelessness increased in the Pine Tree State in 2022, based on point-in-time data, a one-day measure of homelessness produced by MaineHousing every January for the U.S. Department of Housing and Urban Development. 

According to MaineHousing, the point-in-time count for 2022 was 3,455, compared with 1,097 recorded in January 2021.

“This noticeable increase was in large part due to the effort to count as many people without a permanent nighttime residence as possible,” the report said.

For 2023, the report cited several housing-related issues it will be watching: 

• A pilot program “to help municipalities, regional planning groups, and new developers gain the technical knowhow to advance affordable housing in their areas”

• Stabilizing interest rates “in our favor for the foreseeable future”

• Collaboration with partners such as the Advanced Composites and Structures Lab at the University of Maine to develop new methods of construction.

The report also referred to “a priority goal of increasing homeownership for racial minorities in Maine.”