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February central Arkansas housing market report — no surprises

By: 31 March 2011 2 Comments

Yes, it’s time once again for another housing market report that should surprise no one.

In central Arkansas — defined herein as Faulkner, Grant, Lonoke, Pulaski and Saline counties — 445 single-family, new and existing homes were sold in February. That’s down 7.29 percent from 480 sales in the same month last year.

The average sales price in central Arkansas in February was $163,057 — down 1.62 percent from $165,745 in the same month a year ago. Still, any interested observer would likely conclude that a slight drop in the number of homes sold and the average sales price was expected for at least a couple of reasons.

First of all, the National Association of Realtors (NAR) reported declines in the number of existing-homes sold across the nation. In Arkansas, we’ve seen sales mirror national trends regularly. However, swings in sales and average prices — rather positive or negatively — tend to be less severe than what’s going on around the nation. If you’d like to see the complete central Arkansas report featuring January, February and year-to-date data  for 2009-2011, click here and have a look. As always, the data for this report was provided by the fine folks over at Cooperative Arkansas Realtors MLS (CARMLS).

Also, the Arkansas unemployment rate in February was still high at 7.8 percent. While it’s very true that was an improvement over the 8 percent unemployment rate in February 2010, it still means that 106,100 people in the state’s workforce of 1.365 million were looking for jobs in February.

Those statistics don’t exactly inspire consumer confidence. The NAR has pointed to everything from overly tight credit requirements to low appraisals when explaining falling sales, but one simple truth remains — people who don’t have jobs or are worried about losing the ones they do have generally don’t run out and buy houses.

In other words, as long as unemployment remains high, it’s unlikely that we’ll see a dramatic recovery in housing markets around the nation.

Still, there are a couple of facts worth mentioning in the central Arkansas report for February. For one thing, Faulkner County has again bucked regional trends by posting a sales increase of 49.21 percent. Indeed, they’re adding jobs in Conway thanks to a thriving natural gas industry, a Hewlett-Packard (HP) plant that’s adding employees and general economic expansion. See what happens when people can find jobs?

Second, the days on market metric went haywire in February. Homes sold in February sat on the market for an average of 100.56 days — up 27.65 percent from 78.78 days in the same month a year ago.

Third, bear in mind that the sales in February 2010 and 2009 were influenced by tax credits for home buyers whereas sales in that month this year were not. With those incentives removed from the system, it’s little wonder that sales fell.

Now, here’s something more than a bit odd — both sales and average prices were up considerably in northwest Arkansas in February. Click here to read all about that.

About: Ethan C. Nobles:
Benton resident. Rogue journalist. Recovering attorney. Email = Ethan@FirstArkansasNews.net.

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