The Skyline Report for the second half of 2013 shows housing in Benton and Washington counties is experiencing solid growth, and experts are showing little concern about oversupply.
Kathy Deck, director of the Center for Business and Economic Research at the University of Arkansas' Sam M. Walton College of Business in Fayetteville, said the combination of low interest rates on mortgages, stable housing prices and job growth is creating demand for new homes. The semiannual report on the two counties, sponsored by Fayetteville-based Arvest bank, is compiled by the university center.
The Fayetteville-Springdale-Rogers metropolitan statistical area -- which covers Benton, Washington and Madison counties and part of Missouri -- saw some of the highest job growth in the nation for 2013, Deck said.
A report from the Northwest Arkansas Council earlier in March indicated key employers in Northwest Arkansas planned on adding more than 2,000 workers and investing $195 million in expansions over the next three years.
Deck said the increase in value of homes has left fewer owners underwater and more willing to consider selling. According to the report, there were 3,195 houses for sale in Benton and Washington counties in the Multiple Listing Service database as of Dec. 31, with an average list price of $259,465.
"Confidence breeds confidence," she said.
Residential building permits for the last six months of 2013 were up, at 1,094 compared with 982 for the same period a year ago, an 11.4 percent increase. Benton County cities issued 725 of the permits, and Washington County issued 369.
According to the report, on the basis of absorption rates over the past 12 months, there was a five-year, four-month supply of remaining lots in active subdivisions in the two-county area in the second half of 2013. The absorption rate is a measure of the ability of a particular real estate market to sell off all the houses that are for sale.
In the last half of 2013, there were 3,407 houses sold in the two counties, up 14.3 percent when compared with 2,982 sold in the same period of 2012. The sold price of the homes for the final six months of 2013 was $183,983, down less than 1 percent when compared with $185,500 for the first half of the year.
Anthony Clark, principal broker at Clark Partners Realty Group in Fayetteville, said Monday that housing inventory in the $200,000 range and below has been tight, but he expects to see movement as the spring comes on. He said lack of variety has been keeping buyers home, browsing the limited selection in that price point via the Internet rather than touring in person.
"Buyers are a little frustrated," he said. The one place, he said, where he's seeing a good supply of homes under $200,000 is in the Bella Vista area.
Cold weather and snow also have kept buyers indoors and not out shopping, Clark said. As the weather warms, he predicted that houses in the low- to medium-price point will begin to go on the market in earnest, and once folks see their neighbors making quick sales at good prices, others will consider putting their homes on the market.
Home value as expressed in cost per square foot was down slightly in Benton County compared with the first half of the year but was up in Washington County. The average price per square foot in Benton County was $82.29, down 0.2 percent from $82.43 during the first half of the year. The Washington County average for the last half of the year was $87.87, up 4.7 percent compared with $83.94 during the first part of the year.
Business on 03/19/2014