story by Kim Souza
ksouza@thecitywire.com
With two weeks to go before consumers ring in 2015, real estate agents and economists say there is reason for optimism in the housing market based on the growth recorded in 2014.
MountData reports Benton County home sales totaled $842.947 million in the first 11 months of the year as agents sold 4,313 homes. Unit sales rose 2% while sales volume grew by nearly $61 million, or 7.77% from the year-ago period.
In November, agents sold 359 homes valued at $71.195 million, compared to 301 homes worth $52.162 million in November 2013.
“We continue to see population and job growth in Benton County and the housing market has followed that trend. It appears to be healthy growth overall, but the market is still no where near where it was at the peak,” said Kathy Deck, director for the Center for Business and Economic Research at the University of Arkansas. “I am not surprised to see brisk home sales based on the six to eight years of growth in the market.”
Washington County is roughly half the size of its neighbor to the north reporting slightly fewer home sales through the first 11 months of the year. MountData notes that agents in Washington County sold 2,426 homes through November. The value of those transactions totaled $438.226 million. The market activity dipped by 65 homes year-over-year with net volume down 22% from the prior year.
Stephen Brooks, an agent in Fayetteville, said this winter is setting up to be his busiest time yet. He sells property in both counties and said Fayetteville is still a good market for young professionals.
“It’s been super busy for me. ... I have helped lots of folks in the last few weeks.The one standout was the a listing that just sold in Fayetteville. I listed it (home in the $170,000 range) and we got it under contract in less than a week at near full price. We are set to close this week. The seller had already purchased another house and moved but was trying to sell the home himself for about two months before meeting me. After listing, we sold it quickly to a young single professional looking to purchase his first home,” Brooks said.
Brooks, an agent with Keller Williams, said he expects 2015 to be another good year based on the activity he’s witnessed in the recent months.
Deck said home prices on the whole have moved higher, perhaps because of the active new home market. She said there is some concern about all the building that visible in Benton County, but there is no evidence of inventory build up as the new homes are selling pretty quickly.
The one segment of the market that is lagging are homeowners who still have zero to low equity in their homes despite having purchased nearly 10 years ago, which was near the market peak.
“There are costs and fees associated with selling and repurchasing and the market just has not moved enough to help lots of folks who purchased their homes near the peak,” Deck said.
The one positive is that those buyers have had plenty of time to refinance at much lower rates in the past two years. Deck said there is reason to believe mortgage rates will tick higher toward the middle of 2015 but it’s anyone’s guess when that move will begin and how high rates may go.
Home prices across the two county area have come up over this year. The median price of homes sold in Benton County is $155,950, or $85.9 per square foot. Median prices are up 4% from a year ago, according to MountData.
Real Estate appraisal experts recently told The City Wire that home price appreciation of 4% annually looks to be reasonable growth and sustainable, noting that some areas are fairing better than others across region.
In Washington County, median home prices were $150,000 or $87.90 per square foot through November. This compared to $147,950 or $85.70 per square foot for the same period in 2013. The median pricing gain was roughly 2% in Washington County year-over-year.
Deck said lower gas prices are not likely to have a material impact on the housing market unless they remain low for a long period of time.
“It’s feasible to see consumers spend the extra $10 to $15 in their pocket per week from gas savings, but it’s another story to see them commit to buying a home farther from their job because of expectations of low gas prices. Most consumers can still remember $4 gas pretty well,” Deck said.
Real Estate Sales (January through November)
• Benton County
Units Sold
2014: 4,313
2013: 4,228
2012: 3,565
Sales Volume
2014: $842.947 million
2013: $782.141 million
2012: $638.511 million
Median Sales Price
2014: $155,950
2013: $150,000
2012: $145,000
• Washington County
Units Sold
2014: 2,426
2013: 2,491
2012: 2,116
Sales Volume
2014: $438.226 million
2013: $440.101 million
2012: $352.666 million
Median Sales Price
2014: $150,000
2013: $147,950
2012: $139,000