New Hampshire’s real estate brokers and agents aren’t complaining too much – after all, the past year saw single-family home and condominium prices in the state hitting record highs, finally topping their pre-recession heights and suggesting 2019 will see continued strong gains in values in key segments of the New Hampshire market. 

And yet there’s also concern that the price recovery, now in its sixth slow-but-steady year of overall gains, has been achieved as a result of a market imbalance in which demand is far outstripping the supply of available home and condos in New Hampshire. 

“The market is great on one hand, not great on the other,” said Giovanni Verani, president and co-owner of Berkshire Hathaway Verani Realty, echoing the sentiments of others who closely follow real estate in the Granite State. 

“We need to get more supply,” said Verani, whose firm has 17 offices spread across the state. “The market is imbalanced. It’s good for prices, but not good for many people trying to buy.” 

“It’s back to a seller’s market,” said Randy Parker, an agent at Maxfield Real Estate in Wolfeboro. “We are now sold out of inventory. I have people practically waiting in line [to buy].” 

Statewide Median Prices Hit New Highs 

Across New Hampshire, the median price of single-family homes increased to $265,000 in 2018, up from $253,000 in 2017, according to data compiled by real estate data analytics and market insights firm The Warren Group, publisher of The Registry Review. The single-family median price has been steadily rising since 2013, and last year it finally caught up to, and surpassed, the pre-recession high of $262,500 set in 2005. 

Meanwhile, the statewide median price for condos jumped to $197,200 in 2018, up from $187,533 in 2017, according to The Warren Group. Last year’s statewide median price for condos topped the previous pre-recession high of $189,000 in 2005. 

Still, sales numbers indicate that inventory may indeed be playing a role in prices increases, though most real estate observers agree a strong economy is the leading driver of prices.  

The state saw 17,244 single-family home sales in 2018, down from 18,218 in 2017 and 17,610 in 2016. The pre-recession high for statewide sales was 19,639 in 2004.  

For condos, statewide sales were effectively flat, at 5,534 in 2018 and 5,523 in 2017. Condo sales remain significantly down from their pre-recession high of 8,206 units sold in 2005, according to The Warren Group. 

Boring into sub-market prices, last year’s single-family median prices were, once again, strongest in Rockingham County ($355,000) and Hillsborough County ($283,000).  

Portsmouth ‘Normalizing,’ Still Hot 

In Rockingham County, the city of Portsmouth and other Seacoast towns remain the red-hot engine of the county as well as the state, with Portsmouth’s single-family prices jumping to $455,000 in 2018, up from $412,000 in 2017. Rye’s median single-family price increase was more modest but still strong – to $665,000 from $661,000. 

The driver of Portsmouth’s market is its historically quaint, vibrant and walkable downtown and surrounding neighborhoods, features that are highly attractive to young professionals, empty nesters and, increasingly, young families, said Janet Sylvester, a broker and co-owner of Great Island Realty. 

“Portsmouth is not as crazy as it was a few years ago,” said Sylvester, noting the slight slowdown in price increases of late. “It’s normalizing a bit. But it’s still hot.” 

Sylvester noted that one three-bedroom house on Gates Street in downtown Portsmouth recently sold for $1.4 million, “sight unseen – and in cash.” 

New Castle, the nearby high-end island town with only 300 homes, seemed to buck the price-increase norm, with the median price of single-family homes falling to $811,000 last year, down from $1.2 million in 2017.  

But Sylvester said that’s a statistical anomaly, driven by the year-to-year fluctuations in the type and number of properties up for sale in the town. So far this year, all signs point to a statistical boost in prices, with Sylvester noting the recent sale of one home on New Castle for $2.25 million and another home put under contract for $1.49 million in January, after being on the market for only a few days. 

Vacation Homes Bounce Back 

Carroll County also did well, largely due to the strong rebound in vacation home sales. Maxfield’s Parker said a recession-tied backlog of homes for sale took years to finally sell off – and now the Lake Winnipesaukee area has the opposite problem: A lack of inventory. 

Parker said the average home sale in the region is about $300,000 to $400,000, but he’s now seeing “quite a few sales” in the $3 million to $4 million range. One recent blockbuster sale on the lake: A six-bedroom home in Wolfeboro, purchased within the past five years for $8.97 million and sold again for $7.75 million on Jan. 4. 

To the northeast, Brenda Leavitt, a broker at Badger Realty in North Conway, agrees that the vacation home market in the Mt. Washington Valley area has bounced back. She noted the recent $2 million sale of a three-bedroom home in Bartlett and $1.7 million sale of a three-bedroom in Jackson. Meanwhile, units at the new Kearsarge Brook condo development in North Conway are also selling briskly, she said.  

Not every region is roaring ahead, though they’re still experiencing price increases, such as Cheshire County in the state’s southwest, where median single-family home prices increased to $185,000 last year, up from $180,000 last year.  

A cluster of towns north of Keene, such as Gilsum and Acworth, saw impressive price gains last year, but Susan Boyle, an associate at Better Homes and Garden-The Masiello Group said a few higher-end sales caused a spike in median prices. 

Overall, she said, the Keene area has been a reliably slow-growing area of the state, anchored by Keene State College.  

“We’re not getting a lot of companies moving here like you see elsewhere,” she said, referring to the more economically vibrant southeastern New Hampshire, the beneficiary of high-tech sector spillover from Massachusetts. 

“We’re in our own little niche here,” Boyle said of southwestern New Hampshire. “It’s a steady, stable market.” 

For Verani of Berkshire Hathaway Verani, this coming spring and the rest of 2019 should make for another “solid year” for New Hampshire, assuming the economy holds up. But like others in the real estate industry, he said it could be better – if only there was more inventory to sell. 

“The market is not as good as it could be,” he said.