State's February home sales dip

2,114 sold marks 1% slide for first decline in 8 months

Home sales in Arkansas dropped less than 1 percent in February, the first time in eight months that sales declined, the Arkansas Realtors Association said.

There were 2,114 homes sold in February in the 43 counties surveyed by the association, 15 fewer than in February last year. Sales last fell in July, dropping 0.2 percent.

The slight decline in sales isn't a concern, said Michael Pakko, chief economist at the Institute for Economic Advancement at the University of Arkansas at Little Rock.

"We've seen very strong year over year increases over the past three years," Pakko said. "So to see a leveling off for the month of February I don't think should be considered bad news."

February last year was a fairly strong month, Pakko said.

Of the past 10 Februarys, 2016 saw the most home sales, 2,129. The second best February in home sales over the past 10 years was this year. The last time February home sales exceeded the previous two Februarys was in 2007, when 2,205 homes were sold. That was before the recession began in December 2007.

The home sales market has been more active over the past several months than is typical, said Mervin Jebaraj, interim director of the Center for Business and Economic Research at the University of Arkansas in Fayetteville.

"In part, that was because of weather and in part because some of the movement the Federal Reserve was making," Jebaraj said. "I feel that purchases and sales got moved up a little."

The slight February sales decline is only one month and not a trend, Jebaraj said.

"Sales, year over year, are generally going up," Jebaraj said.

Realtors sold 366 homes in Benton County, more than any other county in the state. Pulaski County was second with 306 homes sold and Washington County was third with 214 homes sold.

Pulaski County sales were down 14 percent from February last year.

Average home prices rose 8.5 percent to about $167,200 in the 43 counties.

Prices jumped 12.8 percent in Pulaski County, 16.4 percent in Washington County and 6.8 percent in Benton County.

"It's not unexpected that as the housing market has improved over the past three or four years to see upward pressure in prices, especially in areas where prices have been depressed after the crash," Pakko said. "I don't think we're looking at housing inflation or a fear of a housing bubble. But just a healthy increase in home valuations."

Scott McElmurry, chief executive officer of Bank of Little Rock Mortgage, said his lending firm had a better February than had been expected, but it wasn't as good as 2016.

February isn't typically a good month for home sales, he said.

"It's a healthy market," McElmurry said. "I don't think I'd be terribly concerned about a slight decline in February sales."

March, April and May typically are strong home sales months, he said.

"A lot of it is predicated on the weather," McElmurry said. "The more pretty weekends we have, the more people are out driving around. And they evidently get the idea they want to buy another house."

Business on 04/25/2017

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