story by Kim Souza
The greater Fort Smith metro area, which includes both Sebastian and Crawford counties, continues to report mixed results with respect to its residential housing market as 2012 nears an end.
Agents across the two counties sold 135 homes in November, down from 143 sales a year ago, according to Paul Bynum, analyst with MountData.com.
Sebastian County unit sales rose 11.8% but sales volume decreased to $12.651 million, sliding down some 10% from November 2011. Home prices had been advancing upward throughout the year, but in November the prices fell.
Kevin King, broker/agent with the local Weichert franchise, said the price reduction in November is likely related to more investor activity in the market trying to close ahead of the year-end. He said homeowners and investors alike could have tax reasons for wanting to close their real estate deal in 2012, as the capital gains tax and other tax questions remain in jeopardy for 2013.
King said sellers wanting to close by year-end would likely take less for their properties in some cases which could help drive the overall prices downward.
The median home price in Sebastian County was $111,500 in November, down from $125,500 in the same month of 2011. But through the 11-month period home prices have trended higher overall. At $118,000 Sebastian County shows an $8,000 gain in median sales price from 2011, according to MountData.com.
King reports a stable 2012, saying his firm is on track to match or do slightly better than their 2011 results.
“One positive thing I have noticed lately is a shorter time on market for homes selling. These are homes getting near asking price, not the distressed or greatly reduced properties. The average here is 155 days, but we are seeing more homes going under contract within 60 days,” King said.
Bynum reported the average number of days on market for homes selling in November was 123. For the 11-month period, the average days on market number was 115, which was longer than Crawford, Washington or Benton counties.
In Crawford County, agents sold 31 homes in November with a value of $3.252 million. This is down sharply from 50 units valued at $6.176 million in the year-ago period.
Through the full 11-month period, Crawford County reported 465 home sales worth an estimated $55.411 million. This activity is mixed as well, with unit sales down 5.2%, and total volume roughly flat with the year-ago results.
The median home price in Crawford County for the 11-month period is $112,00, up 6.6% from the prior year.
King said he’s confident the mild recovery in the local market will continue into 2013. He expects foreclosures to continue to trickle back into the market but doesn’t see them having a detrimental impact on local price recovery.
“Our inventory has stayed pretty stable overall and we feel there will be some more buyers coming to the market as job security improves,” King said.
The National Association of Realty estimates there is some 1.2 million households that should form in 2013 – predominantly millennial generation adults between the ages of 18 and 34.
Real estate marketing firm Trulia reports in its 2012 American Dream Survey that 43% of millennials are already homeowners but 93% say they expect to purchase a home at some point.
“Millennials have been shaken, not scarred by the housing bust,” says Jed Kolko, Trulia’s chief economist. “But many of them think today’s low prices and low mortgage rates will last. They may be in for sticker shock if the cost of home ownership has returned to normal levels by the time they’re ready to buy.”
Other agents worry the mortgage tax deduction will be scaled back as Congress works to reign in expenses and revamp tax deductions ahead of 2013.
The biggest concern is the negative impact this would have on buyer sentiment and confidence moving forward.
The NAR doesn’t expect the deduction will go away in one swoop, but that it will likely be reduced in some capacity as early as Jan. 1, 2013.
Home Sales (January through November)
2012: 1,031 units, $141.915 million
2011: 1,072 units, $142.474 million
2010: 1,106 units, $150.049 million
2012: 465 units, $55.411 million
2011: 491 units, $55.401 million
2010: 465 units, $53.829 milllion
Median Home Price (January through November)