story by Kim Souza
The Fort Smith residential real estate market kept up a tepid pace in August with 110 sales valued at $14.837 million. Market activity slipped 19% in units sold with 22% less sales volume than record in the same month of 2011, according to MountData.com.
Combined with Crawford County the metro area recorded 152 home sales last month, down from 180 a year ago. Sales volume also declined to $20.2 million from $24.43 million in the same period.
Economists say the loss of jobs in the region has likely had a dampening effect on broad demand, which is often driven by the lack of solid employment prospects that would also draw new residents to the area. That said, veteran agents like Chuck Fawcett say the new home market has been strong in developments such as the Woods and Cisterna Villas near Chaffee Crossing.
Fawcett said prices are trending up and some of those with good equity positions are both downsizing and moving up into brand new properties.
“I would say this year got off to a pretty slow start but for us demand has picked up in the past few months. We’ve recently sold six homes at the Woods and also completed a couple of resales and continue to see more folks looking to buy new,” Fawcett said.
Paul Walker, developer and builder at Cisterna Villlas located at Chaffee Crossing, said his development is about 12 months from total build out thanks to better sales this year than in the previous two years since the construction began.
“We started with 87 lots and are down to the last 21. Sales have accelerated this year for our custom homes as more folks are looking for no-maintenance lots in this unique residential setting,” Walker said.
Cisterna Villas offer a niche product, unlike anything else in the local area which has likely helped it succeed in an otherwise lackluster market, according to real estate analysts.
Priced well above the median range of $115,000 in Fort Smith, the villas start at $210,000 for 1,800 square feet and go up to a palatial 3,300 square feet costing about $495,000.
The sale of more higher priced homes is likely the reason the local market has seen a steady rise in both median and average home prices this year. MountData.com reports median home prices in Sebastian County through August were $115,000, up 7.47% from a year ago. The average of all 730 sales completed in the first eight months of 2012 was $135,392, up 5.14% from the same timeframe in 2011.
Rising home prices are a national trend that NAR economist Lawrence Yun says relate to fewer sales in the lower price ranges. In recent years a larger percentage of total sales went to bargain shopping investors plucking through what was a larger foreclosure inventory.
“But all of the home price measures now are showing positive movement and that is building confidence in the market,” Yun said. “Furthermore, the higher median price naturally means more housing contribution to economic growth.”
While many markets are seeing higher prices that has not necessarily translated to more overall sales.
Through August, Sebastian County sales totaled $98.836 million, down 4.65% from a year ago. When comparing total sales to 2010, local agents have seen a 14.7% decline in total volume, which means smaller paychecks for some.
Local agents and brokers remain hopeful the Fort Smith market has found its bottom in pricing and sales will turnaround in due time.
While Crawford County is much smaller than neighboring Sebastian County it is holding its own with fairly stable market activity through the first eight months of this year.
Agents sold 351 homes through August of this year with a total value of $41.872 million. This compared to 354 sales worth $40 million a year ago. Agents saw a 4.5% increase in total volume relative flat unit sales.
MountData.com reports 42 home sales in the month of August with a value of $5.37 million, which was also flat against the small month last year.
Median home prices rose sharply in August to $125,000, compared to $106,000 last year. For the full eight-month period home prices were $110,000.
The surge in August home prices indicate either more new home sales or more higher priced existing home sales than customary in this stable market.
Homes that sold this year spent an average of 95 days on the market in Crawford County, this compared to 114 days in Sebastian County and 105 days in Washington County just to the north, according to Mount Data.
At $68.80 per square foot, Crawford County also remains the most economical in terms of median home price compared to some of its neighbors. Sebastian County posted a median square-foot price of $70.60 among the homes sold this year. Both were considerably cheaper than the $81.20 square-foot price recorded in neighboring Washington County.
Home Sales (January through August)
2012: 730 units, $98.836 million
2011: 805 units, $103.660 million
2010: 865 units, $115.973 million
2012: 351 units, $41.872 million
2011: 354 units, $40.041 million
2010: 353 units, $42.010 milllion
Median Home Price (January through August)