Realtors across Benton and Washington counties are having the best year in history through the first six months of 2016, selling 4,603 homes valued at $970.268 million through June.
Sales will easily top the $1 billion mark in July. The 2015 home sales first topped $1 billion in August.
Units sales through June are up 35.9% from the same period last year, according to data provided by Eric Harris at Weichert Downum Realty in Springdale. There were an average of 211 more homes sold each month of 2016, compared to the first six months of 2015. Sales volume rose 23.4% from the same period a year ago.
“Home sales continue to be strong in Northwest Arkansas. If you are a buyer and find a home you like you had better not wait to make an offer on a desirable property. If you are a seller it’s a great time to get your home on the market,” Harris said.
Active buyer demand has created a seller’s market and helped to hoist home prices higher from a year ago. Taking all the sales through the June the median home price rose to $179,900 in Benton County, and $165,000 in Washington County. A year ago the median homes prices were $167,000 and $162,000, respectively. That’s a gain of 7.72% in Benton County and 1.85% in Washington County.
MEDIAN PRICE RECOVERY
Looking back six years in each county it’s clear that home prices are trending higher. Benton County’s median home price through June in 2010 was $129,000. At that time foreclosures were being unleashed in the region and by 2011 median home prices in Benton County dropped to $119,900. Over the next five years the median home price in Benton rose more than $70,000, or a whopping 58.4%.
In Washington County median home prices bottomed in 2011 at $115,000. Since that time median home prices are up more $53,000, or 46.2%.
Nicky Dou, an executive broker for Keller Williams in Bentonville, said this year is as busy as she can remember. Dou was the top producing agent in the region last year with just under $40 million of sales credited to her. Dou told Talk Business & Politics that so far this year she has placed a little more than $30 million under contract. Her sales team which includes her husband Jerry Dou, Terri Elbatnigi and Jenny Miller are also having a great year.
“If we were to add up all of our sales together we would be around $47 million to date,” Dou said.
She said homes priced under $400,000 are selling well, especially new construction. With more high level homes being sold in Benton County, that is part of the reason the median price is up more so than in Washington County.
“Homes priced under $250,000 are selling within days of being listed and some with multiple offers, if they are in good condition,” Dou said.
The low supply of homes for sale in some price ranges are also pushing some prices higher than asking prices. Dou said that has resulting in a few appraisal issues in recent weeks.
“I listed a home in Fayetteville last Thursday (July 7) and by end of Saturday (July 9) I had two offers on it. It was listed at $165,000 so the buyer demand is not only in Benton County,” she said.
Harris’ info showed that Benton County reported unit home sales of 625 in June, valued at $146.851 million. Unit sales were up 18.6%, while sales volume rose 32.17% from $111.105 million reported a year ago.
Washington County Realtors sold 400 homes last month, up 39.89% from the 286 homes sold a year ago. Total sales volume rose to $82.734 million, up 33.9% from $61.743 million reported a year ago.
Northwest Arkansas posted its best June on record in terms overall sales volume and units sold. Average home prices in Benton County last month topped out $234.963, up 11.44% over the $210.827 reported in June 2015. Looking back to 2013, average home prices in Benton County in June are up 23.35%.
Washington County’s average home price was $206,835 in June, below the June 2015 average of $215,885. That said, for the month of June average home sales price are up 16% in Washington County.
BACK HALF FORECAST
Agents polled by Talk Business & Politics said 2016 will likely be one for record books. Economist Kathy Deck, director for the Center for Business and Economic Research at the University of Arkansas, agreed there are solid reasons for the local real estate market to climb to new highs. She said it is supported by a growing population, strong job market in the region.
One of the issues Realtors thought might weigh on demand in the coming months was rising interest rates, but with the Brexit vote and other global issues have pushed interests lower, not higher. The British exit from the European Union, commonly referred to as Brexit, prompted the rate of a 30-year fixed mortgage to drop to an average of 3.41% compared to where it stood a year ago at 4.08%. According to the Federal Home Loan Mortgage Corporation, Freddie Mac, it’s the lowest such rate since May 2013.
The average rate on a 15-year fixed mortgage recently dropped to 2.74%, compared to 3.2% last year.
“Mortgage rates were already low for potential homebuyers and this drop creates an even better opportunity for them to save money and secure an even lower rate when purchasing or refinancing a home,” said Steven Plaisance, president and CEO for Arvest Bank Mortgage Division.
Arvest is one of the largest mortgage lenders in the region. Plaisance said the lender is seeing lots of activity for new purchases and refinances, which is some cases is saving customers $200 per month. The Mortgage Bankers Association also reports a 14.2% increase in mortgage applications following the drop in interest rates that was triggered by the Brexit vote.
This renewed activity in the U.S. housing market comes at a time when the industry has seen low inventory and higher home prices. Industry leaders are hopeful the recently adjusted rates will continue to spark more activity, as homeowners decide to act quickly.
“There is no way to predict how long these rates will remain, or in which direction they will go next,” Plaisance said.
HOME SALES (January through June)
2016: $625.367 million
2015: $491.360 million
2014: $408.608 million
2013: $402.024 milion
2012: $313.659 million
2011: $276.415 million
2010: $272.846 million
Median Home Price
2016: $344.901 million
2015: $274.799 million
2014: $274.799 million
2013: $224.201 milion
2012: $175.644 million
2011: $155.232 million
2010: $170.852 million
Median Sales Price