In northwest Arkansas, the number of residential building permits increased significantly compared to last year, but the value of the permits decreased from their average values in 2014.
This data is comes from the Skyline Report, which examined the region’s residential real estate market in the first half of 2015. Northwest Arkansas also recorded its lowest level of residential lot supply since 2008.
Kathy Deck is the lead researcher for the Skyline Report at the Center for Business and Economic Research at the Sam M. Walton College of Business, University of Arkansas at Fayetteville.
“We’ve seen both demand for new and existing housing increase in northwest Arkansas,” Deck said in a news release. “The increase in the number of building permits is warranted given the type of demand we have for housing right now.”
Residential building permits issued in the first six months of 2015 numbered 1,359, up 14.9 percent from the 1,183 issued during the same period of 2014 and up 29.7 percent from the 1,048 issued between July 1 and December 31, 2014.
Benton County accounted for 845 of the residential building permits, while Washington County accounted for 514.
The average value of all building permits in northwest Arkansas from January through June 2015 was $234,753, down 0.48 percent from the average value of $235,890 reported in the same time period of 2014 and down 5.4 percent from the average value of $248,080 reported from July through December 2014.
The sold price of existing houses on the market were mixed in Benton and Washington counties compared with the second half of 2014. The average sold price of Benton County homes during the first half of 2015 was $200,326, down 1.5 percent from the average sold price of $203,419 during the second half of 2014. In Washington County, the average price of existing homes sold was $194,654, up 8.9 percent from the average sold price of $178,774 in the second half of 2014.
In total, 3,769 existing homes were sold in Benton and Washington counties during the first six months of 2015, an increase of 20.7 percent from the 3,122 sold during the same time period of 2014.
Johneese Adams, senior vice president and mortgage loan manager for Arvest Bank in Fayetteville, said that although the overall value of building permits were lower, the increases in price per square foot suggests that builders and buyers are focusing on smaller sized homes that reflect a greater value for the cost.
“Slightly smaller homes with the same types of amenities seen in larger homes may drive down the average value of the building permit but it reflects the added value that people are looking for while shopping for a home now,” Adams said. “The evidence shows that home buying is not slowing but is actually growing as mortgage rates remain relatively low and rental property is in short supply.”
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