Low mortgage rates and an abundance of homes for sale are just two reasons that three of Arkansas’ four largest home sales markets have sales gains in the first two months of 2012 compared to the 2011 period, according to The City Wire’s February Arkansas Home Sales Report.
The City Wire’s Arkansas Home Sales Report captures home sales data in the state’s 14 most populated counties among the state’s four largest metro areas contained primarily within the state — 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.
The February report shows 2,132 home sales in the 14 counties during the first two months of 2012, up 6.28% compared to 2011 period, and up 13.7% compared to the 2010 period. The combined value of homes sold in the reporting area during the first two months of 2012 totaled $334.495 million, up 13.09% compared to the 2011 period and up 24% compared to the 2010 period.
“There has literally never been a better time to buy a home with inventories declining and the lowest interest rates in history,” said Paul Bynum, a housing market researcher and owner of MountData.com.
Bynum, who provides data on the Fort Smith and Northwest Arkansas areas, said much of the increase in Northwest Arkansas is the result of Walmart returning its apparel division from New York to Bentonville.
Home sales in the four market areas during January were down 1.99% compared to January 2011.
Central Arkansas — Home sales
Jan.-Feb. 2012: 1,032
Jan.-Feb. 2011: 925
Jan.-Feb. 2010: 965
Fort Smith area — Home sales
Jan.-Feb. 2012: 209
Jan.-Feb. 2011: 190
Jan.-Feb. 2010: 195
Jonesboro area — Home sales
Jan.-Feb. 2012: 203
Jan.-Feb. 2011: 233
Jan.-Feb. 2010: 189
Northwest Arkansas — Home sales
Jan.-Feb. 2012: 688
Jan.-Feb. 2011: 658
Jan.-Feb. 2010: 526
The top five counties in terms of Jan.-Feb. 2012 home sales:
Pulaski — 477, up compared to 411 in Jan.-Feb. 2011
Benton — 444, up compared to 389 in Jan.-Feb. 2011
Washington — 244, down compared to 269 in Jan.-Feb. 2011
Saline — 169, up compared to 148 in Jan.-Feb. 2011
Craighead — 156, down compared to 198 in Jan.-Feb. 2011
The average price for homes sold during February in the four markets was $156,576, up 6.06% compared to February 2011. The value of February home sales totaled $183.037 million, up 19.22% compared to February 2011.
Average February sales prices range from a high of $178,035 in Northwest Arkansas to a low of $104,911 in the Fort Smith area.
Fred Dacus, a Realtor with Dacus and Associates, said he believes the February report is an indicator of future growth. Jonesboro area sales during February totaled 122, the best for the month since 124 in February 2008
“I am confident that Northeast Arkansas will see an unprecedented level of growth over the next decade,” Dacus said.
Jackie Twillie, with Twillie Realty in Little Rock, said business is up in terms of homes sales and in the number of people renting homes through the property management side of her business. As for sales, she said homes priced at $400,000 and below are moving well, stating consumer confidence seems to be up.
"We've been doing great. Business is up,” Twillie said.
Kevin King, a Realtor with Weichert Realtors-King Realty in Fort Smith, said the ongoing uptick in area home sales supports sales expectations for 2012. The Fort Smith area posted 209 home sales during the first two months of 2012, up 10% compared to the 2011 period.
“We are extremely optimistic our 2012 sales will be higher than last. Overall, Weichert expects 2012 volume to increase 5%, and while that’s not huge, it is a nice step in the right direction,” King said.
Dr. Michael Pakko, chief economist with the University of Arkansas at Little Rock, cautions against reading too much into improving numbers from the first couple of months of the year. He said the report essentially identifies sales contracts closed in November through January and it is difficult to get a good read on whether the market is recovering until data from the summer months is ready.
Most homes, he said, are sold in June through August, so information from those months will determine if the housing market is locked into the slow, steady upward trend that economists have been on the lookout for since sales began to slump in 2007.
He said the last two quarters of 2011 are encouraging as that slow, steady upward trend has been evident in Arkansas housing markets during the second half of last year.
“There's no guarantee, but that's what you'd expect to see prior to a turnaround,” he said.
Pakko said he expects rental markets will remain strong and could result in upward pressure on prices. The “upheaval” in the housing market, he said, has put some people off home ownership and has pushed others into renting homes and apartments as they don't have the necessary credit to take out mortgages.
Link here (PDF) for all the data in the February report.