The overall number of residential building permits in the region’s four largest cities through the first five months of the year is down compared to 2016, but permit values are up.
According to data from each city, residential permit values from January through May totaled a combined $193.63 million for Bentonville, Fayetteville, Rogers and Springdale, a modest increase of 7.2% compared to $180.61 million from the same period a year ago. The increase is 31.6% when compared to the value of $147.14 in the January-May period of 2015.
Through the first five months of the year, those same four cities issued 729 residential building permits, a slight dip from 745 in the same period of 2016.
“I think what we are seeing is the typical supply and demand cycle,” said Jan Holland, senior vice president with Coldwell Banker Harris McHaney Faucette in Bentonville. “Lack of supply of building lots, yet the homes currently coming out of the ground are certainly benefiting from the rising market and comps.”
Holland sells predominantly in Benton County, but had a recent buyer in Washington County, too. She said her experience in both counties has been the same — limited inventory.
“I think we are in a transition cycle at the moment, with a lot of subdivisions in the pipeline and working toward coming online as fast as they can,” she said. “We will see a lot of these new subdivisions and with new inventory ready in 2018. If you drive through Centerton and Cave Springs right now, you see a lot of red dirt.”
Holland said for perspective homebuyers, this means a lot of inventory will be available in the next year in certain price points. For homebuilders, if they are building affordable and quality homes, they won’t be able to build them fast enough.
Activity was heaviest through May in Fayetteville and Bentonville.
Bentonville issued 212 permits January through May with a combined value of $63.11 million. That is essentially flat when compared to 213 permits and a value of $63.85 million in the same five-month period of 2016.
In Fayetteville, the city issued 223 residential building permits through May, with a value of $51.29. That’s an increase from 196 permits and a value of $46.06 million in the same period last year.
Springdale and Rogers each issued 147 residential permits through the first five months. The value in Springdale was $37.30 million, up about 10% from last year, and the value in Rogers was $41.93 million, up about 14%.