Agents across Northwest Arkansas said pent-up seller demand from the past few years is helping boost recent home sales. And as home prices move higher, more sellers are in position to trade up or down.
In April, local real estate agents sold 677 homes in Benton and Washington counties, which had a total value of $134.62 million, compared to 592 homes sales worth $109.69 million in the year-ago period. Unit sales are up 14.3%, and overall sales volume rose 22%, according to MountData.com.
“The market is definitely accelerating. Our new written business for April was the highest in the history of our company, with over $71 million in sales volume, which is 22% greater than April 2014. Units were up 10% for that same comparable period, which meant that prices are moving up also,” said George Faucette, CEO of the local Coldwell Banker franchise.
Jason Smith, executive broker with Crye-Leike Real Estate in Springdale, is having a solid year. Smith is working with 30 different clients, ready to buy or sell properties, and seven of those are pending sales.
Smith and Faucette said rising prices are helping sellers that have been trapped for several years to finally make the numbers work in their favor. Median sales price rose 13.4% in Benton County to $175,500 last month. Year-to-date those median prices are up 14.5%, which is a huge jump in a year’s time, according to local agents.
At $153,650, median home prices in Washington County inched up 0.5% in April, compared to a year ago. For the first four months of 2015 the median home price ($155,300) rose 6.5% from a year ago, according to MountData.com.
“Even though prices are increasing, it is not at a rate that materially affects affordability, which is of major concern for first time homeowners, and for the market in general. The ability of that segment of the market to purchase homes has a huge effect on the overall market, since it allows move-up buyers to purchase,” Faucette said.
He said even though interest rates increased this past week, they are still at a level that makes homes affordable. Rising rental rates amid limited supplies of single-family rentals in the region also help to support buyer demand, according to industry data.
Faucette said there are many other positive factors at work in the region and he doesn’t see anything on the horizon that would alter the upward trend for the Northwest Arkansas. Paul Bynum, analyst with MountData.com, describes the local market this way.
“It’s hot, hot, hot,” he said, also noting that through the first four months of this year agents have sold 2,275 homes, up 12% more than in the year-ago period. Total sales volume rose 22% to $438 million in the two-county area, buoyed higher by rising home prices that are up 11% on average from a year ago.
The numbers also show that homes sold in just 65 days on average at 98% of their listing price. The median price per square foot stood at $89 at the end of April, up from $83 a year ago.
“We saw improvement in the economy two years ago, but there were those folks who wanted to sell but they could not get what they needed for their property. Now there are more of those people who want or need to make a move adding to the pent-up demand. Sellers today in many cases are able to get the price they need and repurchase a home. It’s definitely a seller’s market with inventory levels down to five months of supply in many price categories,” Smith said.
He said the resale inventory has begun to stir more which is typical for the spring selling season. Even though inventory levels are slowly improving he said there are still too many buyers frustrated with what’s available in their price ranges.
“Part of that is related to unrealistic expectations on the part of the buyers. What I know is that homes priced competitively, well located, and in good shape are selling very quickly today,” Smith added.
Areas deemed hot in terms of activity include west Fayetteville, downtown Bentonville and its outskirts, and Centerton. Agents said property values are lower in east Springdale, Lowell and Siloam Springs.
HOME SALES DATA (January through April)
2015: $280.330 million
2014: $232.330 million
Median Sales Price
2015: $157.673 million
2014: $128.059 million
Median Sales Price