Mervin Jebaraj, director of the Center for Business and Economic Research at the University of Arkansas
In northwest Arkansas, the supply of homes for sale is shrinking and the number of homes sold was flat, according to Arvest Bank’s Skyline Report for the first half of 2017.
The report concludes that the residential market in Washington and Benton counties has continued to show strong activity.
The supply of existing homes and lots dropped to 2,353 from 2,555 in the first half of 2016. The supply of lots was 29.5 months, the lowest level since the Skyline Report’s inception in 2005. That is also down from the 46.1-month supply reported for the same period of last year.
“The supply of existing homes and lots for future development is tightening,” Mervin Jebaraj, lead researcher for the Skyline Report, said in a news release. Jebaraj works for the Center for Business & Economic Research at the University of Arkansas’ Sam M. Walton College of Business in Fayetteville.
“Even more significant is that the supply of lots in desirable areas close to amenities is becoming an issue that will have to be addressed in the near-term,” Jebaraj said. “What we are seeing right now is that the majority of available lots are outside of the city centers, and while many homebuyers are willing to live outside of these areas, many others would prefer to be closer to those amenities.”
The total number of homes sold in Benton and Washington counties was 4,385, compared to 4,373 in the first half of 2016.
More: Click here to see the complete report.
The number of complete but unoccupied homes for sale fell to 227, down from 307 at the same time in 2016. The report said that indicates new homes are being purchased at a relatively brisk pace.
In the first half of 2017, 1,022 newly constructed homes were sold, up year-over-year from 759. The 1,022 represented 23.3 percent of total sales. The 759 was 17.4 percent of total sales.
Permits
There were 1,708 building permits issued in Benton and Washington counties from Jan. 1 through June 30, a 10.8 percent increase from the same period of 2016 and a 4.3 percent increase from July to December 2016.
Permits in Washington County increased by 46 percent from 2016, to 739, while permits for Benton County increased by 6.5 percent to 969.
Jebaraj said Washington County may have experienced more growth in sales because the homes there are more affordable. The average price for Washington County homes was $209,899 compared to Benton County’s $227,036.
The average value of building permits in northwest Arkansas was $237,606, up 5 percent from the average value reported in the first half of 2016 and up 7 percent from the average value reported from July to December 2016.
“The housing market in northwest Arkansas can certainly be described as robust as we continue to experience solid growth throughout the region,” said Chris Thornton, executive vice president and loan manager for Arvest Bank in Springdale. “Our mortgage division reached $1 billion in mortgage loans just a little over halfway through the year, indicating that many consumers are in the market to purchase. And with the supply of both available lots and existing homes for sale tightening, we expect to continue seeing a brisk pace in home sales through the end of this year as many consumers are expecting interest rates to rise in the near future.”
Also, as of June 30, there were 2,353 homes listed for sale (down 7.9 percent compared to June 30, 2016) at an average price of $368,519.
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