Arkansas’ Large Market Home Sales Up 11%

Home sales in Arkansas continue to paint a picture of an improving economy in three of the state’s four largest metro areas, with the Fort Smith region seeing a decline in home sales for the first four months of 2013.

Jeff Collins, an economist for The City Wire, said the April Arkansas Home Sales Report shows that most of the markets covered are moving in the right direction.

Home sales in Arkansas’ four largest markets during the first four months of 2013 totaled 5,728, up 11.06% compared to the 2012 period. The value of homes sold during the quarter totaled $936.886 million, up 15.54% compared to the 2012 period, according to The City Wire’s Arkansas Home Sales Report.

The City Wire’s Arkansas Home Sales Report captures home sales data in the state’s 14 most populated counties within the state’s four largest metro areas — Central Arkansas, Fort Smith area, Jonesboro/Northeast Arkansas and Northwest Arkansas. The report, which records closed sales, accounts for between 70% and 75% of total Arkansas home sales.

Collins said housing is the “canary in the coal mine” for the overall health of the economy.

“It’s amazing how accurately the housing market reflects what’s going in local markets in terms of jobs creation,” he said, adding that central and Northwest Arkansas are clearly on the mend while there’s room for improvement in Fort Smith and Jonesboro.

THE REGIONAL PICTURE
Central Arkansas — Home sales
Jan.-April 2013: 2,749
Jan.-April 2012: 2,483
Jan.-April 2011: 2,381

Fort Smith area — Home sales
Jan.-April 2013: 471
Jan.-April 2012: 481
Jan.-April 2011: 502

Jonesboro area – Home sales
Jan.-April 2013: 553
Jan.-April 2012: 499
Jan.-April 2011: 564

Northwest Arkansas — Home sales
Jan.-April 2013: 2,009
Jan.-April 2012: 1,743
Jan.-April 2011: 1,686

The top five counties in terms of Jan.-April 2013 home sales:
Benton — 1,256, up compared to 1,090 in 2012
Pulaski — 1,250, up compared to 1,176 in 2012
Washington — 753, up compared to 653 in 2012
Craighead — 436, up compared to 377 in 2012
Faulkner— 425, up compared to 343 in 2012

AVERAGE PRICES
Collins said average prices and the time it takes to sell a home also reflect the health of a regional economy.

“To me, when I look at these kinds of numbers, I’m focusing on what’s happening to average prices and days on market,” he said, explaining that increases in average prices and a decline in the amount of time homes stay up for sale are signs of improvement.

The average sales price in the areas covered in the report was $162,035 through April – up 4.03% from $155,752 through the first four months of 2012 and up 11.27% from $145,629 through April 2011. Also through April, homes were on the market an average of 98.24 days – down from 108.39 through April last year and from 104.68 days through the first four months of 2011.

Collins said central and Northwest Arkansas have shown strong improvement in terms of average prices and days on market, whereas the Fort Smith area showed a decline in average sales prices and the Jonesboro area reveals a slight decline in prices and an increase in days on market.

Sherri Bennett, a Realtor with Fred Dacus Associates, said she’s seen strong signs of improvement in Jonesboro. She said new industries are coming in and people are moving in the area to take them. Also, the Arkansas Department of Workforce Services reported the unemployment rate in Craighead County was 6.3% in April – better than the 7.1% for the state.

That information may seem to contradict Collins’ assessment, but doesn’t because the Jonesboro area, for the purposes of the Arkansas Home Sales Report, includes Craighead and Greene counties. Once Greene County is removed from the equation, average sales prices rose in April and average days on market decreased – both signs of an improving economy under Collins’ analysis.

In Greene County, the unemployment rate in April was 8.2% and average sales prices declined in April while average days on market increased.

Bennett said the Jonesboro market is seeing increased demand for homes which has caused home owners to sell their homes at the listed price more often than they have in the past. Indeed, sellers on average received 96.28% of their list prices in April – an improvement over 95.06% a year ago and 95.68% in April 2011. That list price to sales price through April averaged 95.73%.

HIGH PERFORMANCE
In central Arkansas, Nick McDaniel of McDaniel and Company Realtors in Hensley, said his office has certainly noticed an improved economy.

“Over the last 90 days – especially the last 60 days – I’ve sold all my inventory and I’m about to bring five (homes) out of the ground,” he said. “The last two months have been my best out of the last 12. … Things are looking really good.”

McDaniel, who lists existing homes and sells new ones, said that he’s sold 10 new homes this year in the Deer Creek subdivision in East End. He said the homes he’s built and sold are priced from around $128,000 to $154,000 and houses in that range are selling quickly.

Two of the larger real estate operations In Northwest Arkansas had solid gains in April.

“Our April sales rose 58% in volume over last year and our agents closed deals on 36% more homes compared to April 2012. It was our best April in a long, long time,” said George Faucette, CEO of the local Coldwell Banker franchise.

Harold Crye, CEO of Crye-Leike Realty, said his firm’s NWA business was up 58% last month with $37.4 million in total sales. His agents closed deals on 230 homes, up 36% from the same month last year. Crye-Leike and Coldwell Banker comprise a lion’s share of the total market.

TOUGH TIMES
Alice Medlock, broker/owner of Medlock and West Realty in Van Buren (Fort Smith region), said two issues were driving the lower sales volume – first time home buyers and foreclosures. She said both would likely continue to keep prices low, especially foreclosures.

“We’ve already had as many foreclosures listed in the second quarter as we did for the entire year,” she said.

The increase in foreclosures has been drastic at all real estate firms, Medlock said.

“Personally, for my company, probably over the last year, … we’ve had at least a 200% increase (in foreclosure listings).”

She said another factor in the lower price points could be a lack of sellers in all price ranges, such as high-end homes.