“Winning the lottery” means buying a house for a reasonable price in today’s market.
That’s what happened in Kennebunkport this week after a local nonprofit group put a contest together to sell a home for about $326,000. The wealthy enclave has long had the priciest homes in the state, with the typical value now above $1.1 million, according to Zillow.
Despite the acute need for more affordable housing, just 45 Mainers expressed an interest in the contest. Only three actually met the strict criteria to be in the running.
The winner, a single parent with a child in Kennebunkport’s school system, was selected Thursday. The runners-up will get first refusal on two smaller homes in the group’s next project, a six-home neighborhood they hope to secure approval for this fall, according to Larissa Crockett, executive director of the Kennebunkport Heritage Housing Trust.
“She is very excited to have this home,” Crockett said.
The home is located in an inland neighborhood of modular houses built by the trust, about five minutes from the center of town. It’s 1,700 square feet with three bedrooms and 2.5 bathrooms.
Crockett remains at a loss as to why so few families applied to the lottery to win it. She said the trust’s board members will be conducting a “deep debrief” to identify how to improve for their next project.
The restrictions on entering the contest were pretty steep. To qualify, one needed pre-approval from a mortgage lender, to complete a first-time homebuyer education class and to make no more than 120 percent of the area median income, which is around $94,000 for a family of two. The median income in Kennebunkport was $20,000 higher than that in 2022.
The buyer also had to agree to an affordability covenant on the property through a maximum sales price formula on reselling the property. She will need to live in the property all 12 months of the year unless given approval to do otherwise by the trust.
It means the buyer got a great deal, but will not be able to build equity in the property like most other homeowners. Crockett hasn’t heard feedback that the affordability covenant put anyone off applying, and the restrictions, she said, are only fair given how highly subsidized this property was.
“To allow someone to purchase a home at half the market value, to then be able to turn around and sell that home at market value is really, I think, disrespectful of the generosity and support of both public and private resources,” she said.
Despite that, being able to purchase this home was a life-changing opportunity for this Kennebunkport woman, whom the trust did not identify. Someone earning up to 120 percent of the town’s area median income can only afford a home up to around $450,000, according to Zillow’s affordability calculator.
But very few listings come online for less than $1 million in Kennebunkport, Tara Baker, the owner of Kennebunk Beach Realty, said. Only one home there is being sold for less than $400,000, and it is a 365-square-foot tiny home on a campground.
Baker’s agency listed a home last week for under $1 million that received multiple offers and was under contract within three days, she added.
“It’s still a seller’s market, for sure,” she said.
