Northwest Arkansas home sales up almost 22% in 2016

The Northwest Arkansas residential housing market had a strong year in 2016, with sales volume in Benton and Washington counties hitting a combined $1.91 billion, up 21.6% from a sales volume of $1.57 billion in 2015 and a 37.4% increase from sales volume of $1.39 billion in 2014.

According to the latest data provided by Weichert, Realtors – The Downum Group of Springdale, which tracks real estate transactions in the region, overall unit sales in the two-county area finished the year at 9,146, a 9.1% jump from 8,382 home sales in 2015.

The bulk of the growth from 2016 can be found in Washington County, where total sales volume rose a whopping 47.4%, from $494.27 million in 2015 to $728.97 million last year. Agents in the county sold 3,620 homes, up almost 18% from 3,070 home sales a year ago.

Benton County home sales, which crossed the $1 billion threshold for the first time in 2015, continued to climb in 2016 with a 12-month sales volume of $1.18 billion, up 9.73% from $1.07 billion in 2015. Home sales in the county reached 5,526, up 4.0% from 5,312 a year ago.

Eric Harris, an agent with The Downum Group, said good weather and heavy demand for new construction kept the market hot in the two-county area.

“Overall, the growth was tremendous,” he said. “There was a good mix of new home sales and existing home sales. Good weather and heavy demand for new construction kept the market hot.”

A slight rise in home prices was a factor in sales volume increases in both counties. The median home price at the end of 2015 in Benton County stood at $168,875. By the end of 2016, it rose to $174,000, a jump of 3%. Median home prices in Washington County reached $165,000 in 2016, which was 2.5% higher than in 2015.

Harris said in the coming year, infrastructure issues will continue to be present as growth exceeds capacity and the need for better infrastructure will be a challenge. Emerging from a presidential election year should also add stability and growth to the market.

“I expect the market to continue to be good,” he said. “We also have a business-friendly president who is focused on the economy, so that should bode well for the market due to job growth and higher demand.”

HOUSING BUBBLE WATCH
Jan Holland, an agent with Coldwell Banker Harris McHaney Faucette, is based in Bentonville and sells homes primarily in Benton County. She closed $29.5 million in sales volume in 2016, up nearly 26% from the previous year when she was the top-selling Coldwell Banker agent in Arkansas with $23.5 million in sales volume.

Holland has been a licensed Realtor in Northwest Arkansas for more than 13 years. She said she remembers well the housing meltdown in the mid-2000s. With home prices again on the rise and a seemingly “too-good-to-be-true” market, she said she and others in the industry have been on the lookout for signs of a new housing bubble that could burst once again.

“I think all the agents who have been in this market and went through the boom and how it went, we’ve all been kind of watching to see those signs, but honest to goodness, I’m just not seeing it,” Holland said. “It’s a good market to be in. People are confident and excited as we turn the corner into 2017. That’s the kind of vibe I get. We’re ready for another banner year.”

To illustrate the rising cost of home prices in Benton County, Holland said she recently listed a 1,100-square-foot bungalow on Northeast Second Street, a couple of blocks from the downtown square, for $310 per square foot.

“I think about how crazy the prices are, and then I list this and, by golly, it will probably sell,” she said. “In this market, I will believe anything.”

STRONG DECEMBER
Though generally not considered an active month for home sales, Northwest Arkansas agents closed out the year with 826 home sales in December, up 18.1% from December 2015. Combined sales volume in the two-county area hit $175.45 million. Compared to $138.78 million in December the previous year, that represents an increase of 26.4%.

Benton County had 525 home sales last month, adding up to $113.37 million in sales volume. In the same month in 2015, Benton County had 482 home sales valued at $100.28 million.

In Washington County, agents sold 301 homes last month valued at $62.08 million. That’s up from 217 sales valued at $38.50 million in December 2015.

BY THE NUMBERS
Benton County
Unit Sales
2016: 5,526
2015: 5,312
2014: 4,671

Sales Volume
2016: $1.184 billion
2015: $1.079 billion
2014: $915.260 million

Median Sales Price
2016: $174,000
2015: $168,875
2014: $157,000

Washington County
Unit Sales
2016: 3,620
2015: 3,070
2014: 2,643

Sales Volume
2016: $728,970
2015: $494,270
2014: $476,302

Median Sales Price
2016: $165,000
2015: $161,000
2014: $150,000