Central Arkansas homes sales down in June; NAR warns of decline
Central Arkansas sales in June dropped 7.6 percent compared to a year ago but are still up for the year.
According to statistics from Cooperative Arkansas Realtors MLS (CARMLS) in Little Rock, there were 766 sales in June in Faulkner, Grant, Lonoke, Perry, Pulaski and Saline counties – down from 829 sales in the same month a year ago. The average sales price in central Arkansas in June was $172,426 – up 1.26 percent from $170,283 sales in the same month last year.
Through June, there were 4,276 homes sold in central Arkansas, up 11.82 percent from 3,824 sales through the first six months of 2009. The average sales price through June was $165,084 – up 0.54 percent from $164,192 through the first half of 2009.
Bear in mind the sales statistics from CARMLS cover the number of sales closed rather than the number of homes under contract through June. The National Association of Realtors (NAR) pointed out in a July 1 news release that’s an important distinction.
To gauge the future performance of the market, the NAR releases a monthly report detailing pending sales that have not yet been closed. The national pending sales index for May showed sales had dropped 15.9 percent from the same month last year.
The cause for the drop, according to the NAR, was expected – May marked the first month in two years that buyers hadn’t been attracted to the market by tax credits. The most recent credit expired on May 1 and offered qualified first-time buyers up to $8,000 and repeat buyers up to $6,500.
According to the NAR, pending sales should be down for at least a short time now that those tax credits have expired. Under the terms of the credits, buyers were initially directed to have homes under contract before May 1 and close on them before July 1.
Sales statistics in Arkansas revealed the impact of buyers scrambling to close on homes prior to the July 1 deadline. In May, sales in central Arkansas were up 15.95 percent and the June housing market report reflects a good number of closings on homes purchased by people trying to beat the July 1 deadline.
That closing deadline has been extended to Sept. 30, meaning Arkansas housing market reports in July, August and September may still reflect closings by people wanting a tax credit. The NAR, in June, estimated that 2,090 Arkansans would miss the July 1 deadline but most of them could close before Oct. 1.
Nationally, the NAR estimated that 180,000 Americans would be unable to close on their homes before July 1 due to banks being flooded with mortgage applications from people wanting to claim a tax credit and other factors.
In spite of the fact that tax credits are no longer available to buyers, Mortgage Bankers of Arkansas President Justin Moore said people wanting to purchase homes are still at an advantage. He pointed out that home prices have been falling an interest rates are near historic lows, meaning buyers can pick up some solid deals and enjoy lower monthly payments.
Moore said bankers and Realtors face a common problem these days – a perception that mortgages are very difficult to get. He said lending requirements have tightened, but banks are still writing mortgages and are still able to accommodate the needs of many borrowers.
Benton resident. Rogue journalist. Recovering attorney. Email = Ethan@FirstArkansasNews.net.