A home of your own – can you afford it?

Finding an affordable house in the greater Bangor area is more difficult than some prospective buyers originally anticipated, but housing officials say there are affordable homes out there.

“The vast majority of houses I’ve seen need substantial work in the first few years of owning them,” Tanya Pereira, 30, of Holden, who is looking to buy a home, said Thursday. “At this price range, there’s very little that’s ready to go without some sort of investment.”

A single mom, Pereira’s looking for a two- or three-bedroom home in the $100,000 range for her and her 4-year-old daughter Sophie, whose given name is Sophia. Pereira said she’s been renting a small house in Holden for the last two years since her divorce, but hopes to purchase a home by the time her daughter starts kindergarten about a year from now.

“I’m obsessed with having enough space for Sophie’s swing set,” Pereira said.

But there are some things she’s willing to exchange for what’s most important, like a place for Sophie to play, good schools and a safe neighborhood.

“I really had to lower my expectations,” Pereira said. “I’ve really had to look at what I’m willing to sacrifice.”

While there’s no concrete definition of an affordable house, the general rule is that buyers shouldn’t spend more than 30 percent of their adjusted gross income on their mortgage.

“In greater Bangor or Penobscot County, there are homes available,” Michael Aube, Maine’s U.S. Department of Agriculture rural development director, said Wednesday. “There seems to be an availability of both new construction as well as existing homes that are affordable.”

That’s a good sign for the economy as well, Aube said.

“One of the engines that drives the economy in Maine is not just the housing industry, but the affordable housing industry,” Stephen Mooers, director of Penquis CAP housing services and housing development, said Wednesday. “People like Cianbro and Hollywood Slots, they’ve got to have people to work.”

Those people need places to live. While some don’t want to make the potential 20- or 30-year commitment to purchase a home, the majority of people like to own, Mooers said.

When developing new housing projects, Penquis CAP primarily focuses on rental housing, such as that on Griffin Road in Bangor. But recently it completed a single-family development in Searsport, and Mooers said he’s always looking at the market and possible housing options.

“The city of Bangor has about 35,000 people,” he said. “It has the infrastructure to sustain a population probably twice that size, but it doesn’t have the housing to accommodate it.”

The main reason for that, is the lack and cost of land.

“Where are you going to put it?” Mooers asked.
What’s available

The Web site www.Realtor.com is a popular site used by potential buyers. As of Friday morning, there were 1,193 single family homes listed for Maine’s northern region 2, which runs from Dixmont to Bangor and north to Enfield.

But when the search criteria is set with $150,000 as a maximum, the listings shrink to 421. For someone looking to spend $125,000 or less, there were 237 listings, and at $100,000 or less there were 130.

When the search is modified again to include properties within the Bangor zip code, there were 562 available single family properties with 107 listed under $150,000. That number dropped to 20 listings at $100,000 or less.

Most single family properties under $70,000 were camps or homes that need extensive work with phrases in their descriptions such as “being sold as is” or “handyman special.” Descriptions of those in the $80,000 to $90,000 range begged for some tender loving care or the properties were in more rural areas, such as Dexter or Corinna.

That’s not to say homes aren’t selling. Based on their observations of the market, Aube and Mooers noted that the real estate market is beginning to shift and become a buyer’s market.

“It’s a buyer’s market for the first time in a long time,” Mooers said.

Penquis CAP, through its MaineStream Finance program, provided homebuyer education to more than 300 individuals last year. In addition, the organization assisted 20 families and individuals in purchasing a single family home, according to Penquis CAP Community Relations Manager Jennifer Brooks.

Last year, Aube’s office assisted about 111 people in finding a home they could afford in Penobscot County.

“That’s probably about an average [year],” he said.

Maine’s home ownership rate is more than 76 percent, which is among the highest in the country, according to Aube. The national ownership rate is about 69 percent.

It has been proven that there’s a direct link between economic development and home ownership, according to Aube and Mooers.
Mainers like to own

Mooers says Maine’s home ownership rate also has a lot to do with New England mentality.

“People in Maine like to own, they don’t like to rent,” Mooers said Wednesday. “Poor people don’t own anything traditionally, but they do here in Maine.”

Many Mainers tend to follow the old adage that if you can’t afford to pay cash, don’t buy it. That sometimes makes it difficult to build good credit, which is what most lending institutions base their decisions on.

Maine residents whose incomes fall below the state’s 2006 median income of $44,488 also run into problems.

“The thing that’s missing in the lives of most low-income people is equity,” Mooers said.

The average family of four with both parents working minimum wage jobs brings in about $25,000 per year, he said.

“They can’t afford a typical home today without some subsidy,” Mooers said.

The form of subsidy also has changed in recent years.

“The days of grants have sort of disappeared,” Mooers said. “We’re in a war right now.”

There are forgivable loans available, which are similar to grants, but most of the assistance provided to buy comes in the form of low-interest loans and other funds that have to be paid back.

Pereira said she’s fortunate to work for the city of Brewer and have a good-paying job, but that it’s difficult to find something suitable with only one income.

“Everything adds up so quickly,” she said.

A good school system is very important, while Pereira considers a third bedroom more of a luxury.

“It’s not going to be my dream home, but it’s going to be a great first step for Sophie and I,” Pereira said.
A home for $100,000?

Pereira’s not alone in her search for a home in the $100,000 range.

“We get a lot of calls from people looking in that range,” Pereira’s realtor, Tricia Largay of Realty of Maine, said.

Jonathan and Karen Prete of Bangor also are trying to find an affordable two- or three-bedroom home with more than one bathroom.

“We’re not looking for anything very elaborate, just a nice comfortable home, and it’s really hard to find,” Karen Prete, 42, said Thursday. “The ones that we have found, they have something wrong with them that would prevent us from getting homeowners insurance or that would make us have to spend a fortune to fix them after we purchase them.”

The Pretes have seen rotted support beams, leaky roofs, faulty wiring, and bad neighborhoods in their search for a home.

“I’m not so concerned with cosmetics or anything, because that’s easy,” Prete said. “I just want a basic, sound house.”

Pereira is looking for the same thing. The single mom said she’s not very handy when it comes to major repairs and has to consider what could go wrong down the road when she looks at a house.

“If I get into a house, what’s going to go wrong in the first five years?” she asked. “The vast majority of houses I’ve seen need substantial work in the first few years of owning them.”

The quest became so frustrating for both families that each stopped looking for a while and just recently started searching again.

“When we first started to look for a home we were very enthusiastic. The longer the search continued, the more it seemed like a chore,” Karen Prete stated in a recent e-mail.

She estimates she and her husband have looked at more than 20 homes and still haven’t found anything they want to buy.

“It just got so frustrating. It just made me so angry and frustrated just looking and looking and looking,” Prete said. “Maybe we are just destined to be in an apartment for the rest of our lives.”

By Aimee Dolloff, Bangor Daily News

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