An unseasonably pleasant summer in Northwest Arkansas, expanding job base and growing population have helped keep home sales stable against last year’s stellar results.
Agents sold 722 homes in July across Benton and Washington counties, which was five less sales than a year ago. Total sales volume in the region topped $141 million in July, up from $140.5 million in the year ago period, according to Paul Bynum of MountData.com.
Supply and demand in the local market reached an equilibrium in 2013 with rising property values and fewer foreclosures.
“This summer has been flat. It really has not been extraordinary in terms of new home and existing home sales. But, this pace appears to be sustainable and that’s not bad given the record year in 2013,” said Phillip Taldo, broker with Weichert Realtors, the Griffin Company in Northwest Arkansas.
Taldo is also a new home builder who said that sales market slowed in the summer, but starts have been steady. Aside from a healthy relocation business, Taldo said the uptick in home prices and the low interest rates are giving more people an opportunity to sell their home and move up.
FORECLOSURES, INVENTORY SHIFTS
“The number of foreclosures continue to thin out creating more pricing power for homeowners. We are seeing prices rise at a pretty nice clip. My estimate is 5% or so for this year as a whole,” Taldo said.
Irvine, Calif.,-based RealtyTrac.com recently reported 35 new foreclosure filings in July for properties in Benton County, down 74% from the year-ago period. In Washington County there were 16 new foreclosure filings in July, down 71% from a year ago.
The local region is trending with the nation as July marked the 46th consecutive moth where foreclosure activity is down on a year-over-year basis, according to Daren Blomquist, vice president at RealtyTrac.
There were 3,672 homes listed for sale in the two-county region in July, 65 less than the prior month and flat with the year-ago, according to MountData.com.
New homes accounted for 462 of the property listings, or about 14% of the total inventory. The new home inventory levels are up over the past year by 35% as more builders have become active in the market. A year ago, new home listings totaled 341, or about 10% of the total market.
Agents sold 4,124 homes in the first seven months of this year. Those sales totaled nearly $774 million, according to an updated report MountData.com on Aug. 28. Unit sales were flat against a year ago and total volume rose nearly 2% over the same period in 2013.
The volume gain is related to higher prices across the region and continued growth in Benton County. Benton County agents have sold 2,615 homes this year, with the combined sales value hitting $498.793 million, a median sales price of $152,000 and an average price of $190,943.
Taldo said Benton County is about twice the size of Washington County and that’s been part of an ongoing trend for several years given the larger population.
Nicky Dou, a broker with Keller William in Bentonville, said she’s having a great year despite two slow weeks to start August.
“I got four offers over the weekend. It was slow for about two weeks in August and is already picking back up,” Dou added. “I honestly don’t know if this is just how things are going for me or all agents, but I am very happy with the market this year leading into the fall and winter months.”
Dou said two homes she listed in the past week were previously listed with another agent for the previous six months.
“Both of them went under contract within the first week at the same asking price. The buyers are out there and I really believe it is all about how you get those listings out to those buyers. In my case that’s through strong Internet marketing,” Dou said.
Bynum reports it took an average of 53 days for buyers to go under contract and the sales-to-list price ratio is 97.9%, which is a sign prices are trending higher.
Agents in Washington County have sold 1,509 homes this year, compared to 1,572 in the year-ago period. Total sales volume dipped 0.5% to $273.744 million, from $275.180 million a year ago, according to MountData.com.
Bynum said in the combined the two counties the median price per square foot this year is $86, up from $82 a year ago. The median sales price of $152,000 is consistent with a year ago, with average prices skewing higher at $188,000.
Taldo expects home prices to increase in the coming months led by higher new home prices that will happen sometime in the next two years as builders are forced to develop more lots amid already very slim supplies.
“Lot prices at $40,000 won’t be the case in new developments. I can see $10,000 to $15,000 more added on the land costs of new homes, which is going to raise the price per square foot by some $10. It is going to happen, it’s just a matter of when,” Taldo said.