Northwest Arkansas homes sales jump 24.4% in March on more units, higher prices

Realtors in Benton and Washington counties say they are barely able to keep up with early 2016 demand as March home sales were up an impressive 24.4% over March 2015.

There were 780 homes sold in March in the two-county area with a combined value of $161.177 million, well ahead of the 667 home sales worth $129.463 million in the same month last year. The strong numbers in March echoed the 14.82% higher sales volume reported in the first two months of 2016.

Through the first quarter of 2016 Northwest Arkansas agents have sold 1,865 homes worth more than $365.899 million, according to data provided by Eric Harris, agent with Weichert Downum Group in Springdale. Harris said the residential market sales volume is up 19.4% from a year ago, while unit sales rose 16.85% from the first quarter of 2015.

George Faucette, co-CEO of the local Coldwell Banker franchise, said that firm’s sales volume rose 13% in the first quarter thanks in part to a 10% increase in the average sales prices from a year ago. He said March was especially strong with sales volume jumping 25% with average prices increasing 19% year-over-year. He attributed some of the average sales price increase to more upscale buyers coming to the area and more expensive homes being purchased. He said rising prices also are a product of overall increased demand (regional job growth primarily) relative to supply.

“The good news is that new construction is accelerating, and I suspect, and very much hope, that with more inventory becoming available from that source, that the increase in the average sales price will ameliorate. That level of price increases is generally not healthy for a long-term sustainable market,” Faucette said. “Of course, the continued low level of interest rates is very helpful in getting people in houses, especially first time homeowners where affordability is key.”

Agents in Benton County sold 1,171 homes in the first quarter, with 493 of those sales reported in March. The sales volume in Benton County through the first quarter was $236.538 million, up 25.82% year-over-year. The median sales price rose to $169,000 in March, up 5.65% from the $160,000 reported in March 2015. The median price square foot is up to $92.38 at the end of March, also a gain of more than 5.6% year-over-year.

In Washington County there were 694 homes sold in the first quarter compared to 620 in the same period last year. The sales volume increased 9.38% to $129.361 million in the first quarter, compared to $118.262 million in the year-ago period. Median home sales prices declined to $156,000, from $159.000 a year ago. While median sales prices dipped, the median price per-square-foot rose to $93.36 in the first quarter, compared to $90.60 per square foot a year ago.

Stephen Brooks, an agent with Keller Williams in Fayetteville, described the markets in both counties as “very active.” He’s put multiple homes under contract this year that have sold within one week at their full asking price in Bentonville and Fayetteville.

“I listed a house in a Fayetteville neighborhood last fall, and just now listed the house next door. The sales price (per square foot ) has gone up at least 5% over the past six months,” Brooks said. “In another recent listing we got three offers in the first week and it sold for more than list price.”

He said average sales prices are going up at the same time the days-on-market are going down, which is an indication a market is heating up.

“Inventory is down and buyer demand continues to rise, buyers today are not able to be that choosy,” he said, adding that if buyers wait too long the house may come under contract to someone else.

Brooks said the year is off to a crazy start and he’s waiting to see how the summer rolls through before making any predictions on full-year growth. He said new construction is up across the region and with more new development on tap that should help ease some of the demand overload in the coming months.

But with lot prices trending higher than a year ago, Fayetteville developer Mark Marquess recently told Talk Business & Politics that builders are challenged with keeping prices at last year’s levels. He said the only way builders can construct new homes in the $150,000 range is if they do their own development. The median home price in region is already up to $162,500 in March at nearly $93 per square foot.

“I am really surprised that more folks aren’t selling their homes given the higher prices today coupled with low interest rates that could provide opportunities to move up or down pretty easily,” Brooks said.

HOME SALES (January through March)
Benton County
Sales Volume
2016: $236.538 million
2015: $187.985 million
25.82%

Unit Sales
2016: 1,171
2015: 976
19.97%

Median Sales Price
2016: $169,000
2015: $160,000
5.62%

Washington County
Sales Volume
2016: $129.361 million
2015: $118.262 milion
9.38%

Unit Sales
2016: 694
2015: 620
11.93%

Median Sales Price
2016: $156,000
2015: $159,000
-1.88%