September homes sales up in central Arkansas
We’ve already seen that homes sales were up last month in northwest Arkansas and the same held true for markets in the central Arkansas market.
For the purposes of this report, the central Arkansas market includes Faulkner, Grant, Lonoke, Pulaski and Saline counties (which are located in the Little Rock-North Little Rock-Conway Metropolitan Statistical Area) and the nearby Jefferson and White counties. Why add in a couple of neighboring counties? Simply put, the markets in Jefferson and White counties are closely connected to those in the traditionally defined MSA.
At any rate, Realtors sold 754 single-family, new and existing residential homes in the central Arkansas area — up 25,67 percent over 600 sales in the same month last year. The average sales price was $160,122 — down 2.4 percent from $164,064 in September 2010. The report references closed sales.
To have a look at the complete report covering sales, average prices, median prices, price per square foot and other metrics from 2009 through 2011, click here for the Microsoft Excel file or here for the PDF.
September marks the third straight month in which sales have increased compared to the previous year. The question, of course, is why are sales on the rise? Area Realtors and mortgage bankers have told First Arkansas News the answer is quite simple — low prices and mortgage interest rates have attracted buyers to housing markets.
There may well be some truth to that. According to Bankrate.com, the national average interest rate on a 30-year mortgage is 4.16 percent. On a 15-year, fixed-rate mortgage, the average interest rate is 3.45 percent. Those historically low rates have been in place since the summer and the national Mortgage Bankers Association has forecast that interest rates will remain low through 2012 and will likely start increasing substantially in 2013.
It’s easy enough to show that prices have been on the decline this year and how buyers have responded by taking a look at a couple of fundamentals that have largely been ignored when discussing homes sales in Arkansas — price per square foot and the average size of homes sold through September. The average price per square foot through September in the central Arkansas was $74.13 — down 2.82 percent from $76.28 in the first nine months of 2010. That $74.13 average price per square foot is also down from $75.78 through September 2009.
Meanwhile, the average size of homes sold through September was 1,895 square feet, up from 1,878 square feet through the first nine months of 2010.
In short, buyers are generally purchasing larger homes, paying less for them and taking advantage of historically low interest rates. The fact that increased sales have emerged from that environment, then, may come as little surprise.
Meanwhile, sellers received 95.87 percent of their asking prices through September, down from a list price to sales price ratio of 96.28 percent last year and 96.62 percent in 2009. Additionally, homes sold through September sat on the market for an average of 97.72 days — up from 77.51 days last year and 83.34 days in 2009.
Benton resident. Rogue journalist. Recovering attorney. Email = Ethan@FirstArkansasNews.net.