By Anne Ehart
In March, the Millinocket Town Council auctioned six tax-foreclosed properties, two of which sold for just $1. These auctions have become a routine occurrence in the once flourishing paper mill town, which has assumed ownership of 97 properties through tax foreclosure since 2012, selling off as many as 25 at a time.
Declines in the paper industry–including the 2008 shuttering of the town’s Great Northern Paper mill–caused Millinocket’s population to shrink nearly in half from a high of 8,000, leaving the town with empty homes with virtually no value, and no one to fill them.
The median home value dropped to $65,000 in 2015, a 12 percent decline from $73,775 in 2000, an economic survey of the town by researchers at the University of Maine at Orono found. That is less than half the median home value for the rest of Penobscot County, which is $137,400.
One-quarter of the homes in Millinocket had tax liens placed on them in 2014 and 2015 alone, according to officials. The town places a lien on a home when the owner’s property taxes are long overdue, ensuring the town gets first rights to the property should the owner fail to pay up within 18 months.
Officials said in July 2016 that the town had taken ownership of 97 homes through foreclosures since 2012. No price is too small to get these homes back to good use, which is how local business owner Steve Golieb was able to buy two dilapidated properties, which he will renovate and restore, at the most recent auction for $1 each.
Locals are beginning to see a slight resurgence in the Millinocket real estate market, a reflection of what some see as the area’s best asset: the beauty of the Katahdin region, which is drawing more eco-tourists.
Dan Corcoran, owner of North Woods Real Estate, Millinocket’s only real estate office, attributed the uptick to vacation home sales on nearby Millinocket Lake, which offers spectacular views of Mount Katahdin.
“It really didn’t start to change until about two years ago,” said Corcoran, who said he bought the business in 2003, at what he describes as “the worst possible time.”
The resolution of a long-running environmental battle over the future of 87,000 acres of land in the Katahdin region owned by Burt’s Bees co-founder Roxanne Quimby also paved the way for more visitors. The battle, which pitted locals who supported using the land for timber harvest and those who wanted to protect it to attract tourism, ended in August 2016 with the establishment of Katahdin Woods and Waters National Monument.
“We started seeing people coming into the office and wanting to look at property, people who have never been here before but came because they heard all the talk about a national monument,” said Corcoran. “They’d be here for just a few days, and then want to buy real estate. They saw how beautiful the area was.”
Other clients became interested in buying property after running in Millinocket’s recently established December marathon, he said.
Corcoran said 80 percent of North Woods business is in recreational properties: vacation homes and plots of land with a view of Mount Katahdin, and islands on scenic Millinocket Lake and the surrounding waters.
The founder and owner of New England Outdoor Center, Matt Polstein, estimated that a lot with a view of the mountain would sell in the $180,000 to $200,000 range, just for the land. Most lots have tiny shacks on them that need to be torn down, costing another $250,00-$260,000 to build a home.
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Locals are able to benefit from the recent interest in lakefront properties by cashing in on sales of desirable land they own on Millinocket Lake. Much of the land on the lakefront is owned by former mill workers who were issued inexpensive leases there as part of a benefits package from Great Northern Paper. The paper company once owned two million acres of land around the lake, but the leased plots were given to laid-off employees when the company went out of business.
“They actually have something out here that if they want to sell, they can monetize,” said Poletein. “At a time where everybody in the U.S. was building equity in their home, this area was having it stripped away at a pace that was sickening.”
Interest in seasonal homes outside of Millinocket is attracting some people to buy real estate in town, too. Former mill worker David Hartley recently sold his home in town for only slightly more than he bought it for, after just three days on the market. A welding instructor at Northern Penobscot Tech Region III, Hartley bought his 2,000-square foot home for $46,000 in 1995, and sold it this year for $52,000.
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Though 100 pennies can buy certain properties, some houses in town have price tags with six figures. “Last year, we had a half a dozen houses on the market for over $100,000, and we sold all of them,” said Corcoran.
“In the last year, the town has really picked up quite a bit,” said Corcoran. “The market has come a long way and what we see happening with the manufacturing side of the economy is really going to boost that residential market a lot,” said Corcoran, referring to the prospect of a new industry bringing jobs to the former mill site and filling up homes.
The local real estate market is beginning to show signs of life, but the local economy will have to be revived to see a true resurgence in home value. Whether that can be done will depend on what are still speculative hopes of bringing new industry, such as cross-laminated timber, to the mill site. The possibility of 100 jobs on the mill will not bring Millinocket back to the fast-paced, high-priced home market it once was, but will be a healthy, sustainable industry for the town, unlike the boom and crash of the paper mill.