I have to apologize to everyone for it being June 17th and I am just now getting the May report done.  A lot has been going on in the market: interest rates have come up some, foreclosure sales are down (a good thing) home prices are up, pending sales are up, and general market sentiment is much higher than in the last few months.  Here is the Northwest Arkansas Home Prices and Market Report for May of 2009.  I do hope you find it interesting.  Remember that you can find all of my monthly market reports in Market Conditions.

Northwest Arkansas Home Prices and Housing Market Report

We’ve got some pretty astounding numbers this month.  The average Sales Price of a home that sold in May vs. a home that sold in April of this year went up over $24,000 to $168,181.  An increase of  just over 17% in one month.  I’m not saying the average home in Northwest Arkansas’ value increased 17% in the past thirty days.  But what I do think is happening is just about as good.

Foreclosure sales have dropped off significantly to be replaced with traditional home sales.  As we know, foreclosures artificially lower average sales price of normal properties so I think we can safely say that more ‘normal’ homes are selling.

To further my argument for more normal sales, the price per square foot sold has gone from a low of just over $79 per foot in February to this month’s high of $90.48 per square foot.

Average Home Prices for Sold Properties in Northwest Arkansas

While we had a bit of a hiccup last month, this month’s average sales price of over $168,000 brings us back to fall 2008 levels.  I don’t know what you see but I see recovery.

May numbers by City

Below are individual city numbers.  I will remind everyone that these numbers don’t add up to the complete NWA numbers because smaller cities and rural areas are not taken into account here.  If you want specific numbers on other cities or areas you can contact me, call your Realtor, or do it yourself (if you are a Realtor).

With the exception of Bentonville… each town had a statistically significant increase in home sales over the past month.  50% more homes sold in Fayetteville in May than in April! If that’s not significant, I don’t know what is.

Northwest Arkansas Pendings, Solds, and Expireds by Month for 2009

I love to see pending sales trend up like this.  It means many more closing in the next 30-60 days. You can also see the number of expired dropping significantly.  To me, this means homeowners and buyers are coming to a meeting of the minds when it comes to value and the ultimate sales price.

Current Inventories in each Northwest Arkansas City by Month

Besides some building going on in Fayetteville that is skewing their numbers a little…currently listed property inventories are falling in each sub-market of Northwest Arkansas.  Less supply equates to higher prices.  As Ron Burgundy would say, “It’s science.”

Average Days on Market by City

This one is kind of a messy graph.  But it does help you see how each city is faring and how long properties typically stay on the market.  The average for all of NWA went up to 168 days this  month.  Hopefully, with the drop in supply and increase in demand… we’ll see these numbers drop over the next few months.

Absorption Rates by Price Range

For a numbers guy like myself… this is the most interesting graph of all.  As absorption rates continue to fall each month we’ll see prices come into balance.  Supply and demand will stabilize and a healthy market will resume here in Northwest Arkansas.  Pay special attention to the blue line as that is where the majority of properties in Northwest Arkansas fall.  If the absorption rate continues to fall to 7 or lower… *gasp* we’ll be looking at seller’s marketing again.

Before we go… a note on Absorption Rates

Many pure staticians would say I don’t figure or quote absorption rates correctly.  Well, I do what makes sense.  I also ‘levelize’ the figures by average the past 3 months worth of sales in the data.  I find it is a truer representation of the trend.  And the trend, ladies and gentlemen, is what we want to know anyway.

Take this quote from WikiAnswers:

The number shows the rate at which the inventory of homes for sale are being sold. A declining figure indicates [to] people the inventory is decreasing as more homes are being sold than are coming onto the market. A rising absorption rate implies that there are more homes coming onto the market than there are buyers willing to buy at the market prices.

The absorption rate lets you know how well the market is absorbing the current inventory of listings. The ultimate question the absorption rate answers is, “Is the current inventory level shrinking or growing“?

I hope that helps you see how useful a tool the absorption rate can be.

Well that’s it for this month’s market report for Northwest Arkansas.  After some months of slogging through the detritus, it looks like NWA is coming through the bubble (I call it a Swell for Northwest Arkansas) better off than most of the rest of the country.  If you haven’t read it yet, check out The Forbes List of Best Cities for Recession Recover over at our broker site EXITprorealestate.com

As always please leave your thoughts about the state of the market if you have any.  If you like this market report and want to continue to read them on a regular basis (they make more sense that way) then use the form just below to subscribe by RSS or email.  Thanks for reading.

I now have the Market Report above available as an unbranded PDF!  I want people to use the market data we have so feel free to print this off…attach your card, and pawn it off as your own!  If you’re real snazzy you can even modify the PDF to embed your contact info and email it out to all of your clients…don’t say I never gave you anything.  Download the 1-page PDF here.

No related posts.

Northwest Arkansas has been ranked the #2 best place for recession recovery according to research done by Forbes magazine.  We all know Northwest Arkansas is a great place to live and work.  Now the rest of the country knows it too.  What that mean for the future is good news for all of us in Northwest Arkansas…

As the article in Forbes says, “What better way to sit pretty during a recession than to have the ultimate recession-proof company headquartered in your neighborhood.”  People can say what they want about Wal-mart but I think we could all give a quick thank-you to the retail giant that has helped us weather the on-going storm.

A quick rundown of the Forbes article.

Northwest Arkansas placed second behind Austin Texas as a candidate for quick recovery.  Other areas that made the list were:

• Boulder Colorado
• Huntsville Alabama
• San Antonio Texas
• Mobile Alabama
• Dallas-Fort Worth
• Washington DC
• McAllen Texas
• Seattle-Tacoma Washington

The article’s choices were based on several criteria:

• Moody’s projected gross domestic product (GDP) of metropolitan areas across the US
• Unemployment figures from the Bureau of Labor Statistics
• Home prices, incomes and affordability data from the National Association of Home Builders

The Fayetteville-Springdale-Rogers MSA (Metropolitan Statistical Area) has a current GDP of $13.9 Billion and an estimated GDP of $14.5 Billion by the end of 2010.  After a quick visit to the calculator, I see that’s an increase of over 4.3% in Gross Domestic Product over the next 18 months.

Unemployment is much lower than the national average at 5.0% and you can see our most current home prices in the market conditions section of this site.

What’s this mean for the Northwest Arkansas Housing Market?

It depends on your situation.  If you are planning on buying a home but aren’t buying until the fall of 2009 or later, this isn’t really good news for you.  As you’ll see in our upcoming market and home prices report, absorption rates are stabilizing, prices are higher than they were a few months ago, and interest rates are up a percentage point from their lows of a few weeks ago.  All things being considered though…there is still a large selection on the market and some killer deals to be had this summer.

If you are a homeowner, business owner, or just a Northwest Arkansas resident…this is some pretty good news that will only get better.  Higher home prices means more disposable income, which means more spending and saving, which ultimately means a happier, healthier economy here at home.

Here’s a sneak peak of what you’ll see in the home prices report this month…

I don’t know how you read it but I read “the bottom has passed.”  There’s still time to get in on some deals of the century though.  Contact EXIT Pro Realty today to find out more about the 8,000 tax credit, low interest rates, RD loan program, and a host of other great things that make now the right time to buy.

No related posts.

April Buyers bring May closings!  If last month’s Northwest Arkansas Home Prices and Market Report was uplifting…this month’s Market Report should have you singing in the rain.  While prices in Northwest Arkansas are nowhere near their highs of several years ago, there is a definite bullish trend in prices, absorption rates, and pending and closed inventory that should make buyers get out and ‘get while the gettin’s still good.’  National buyer confidence for house is trending upward and the trend supports the numbers in this month’s Residential Real Estate Market Report for Northwest Arkansas.

Northwest Arkansas Home Prices and Housing Market Report

While the average home sale price did dip a bit from last month…I stand firm that the shift to higher home prices has begun.  Many of the sales closed this month were foreclosure inventory coming off the market and so drove the average sales price of homes in Northwest Arkansas down some this month.  I fully expect May numbers to show an inclrease in sale prices over April.  Pending home sales remain strong this month over the last few showing that buyers are buyer and and sellers are selling…now that’s a magical equation.  Just to recap, February had 526 pendings, March had 1092, April had 843.  Compare this month to all my monthly market reports here.

Here are the running average home prices in Northwest Arkansas

As you can see…the average sales price for homes that closed in April fell a bit from March, but this is mostly due to the high ratio of foreclosure sales to standard or owner-occupied sales.

April Numbers by City

Here are the April number broken down by major city.  It has been pointed out to me recently that, when added together, these numbers don’t equal the numbers for all of Northwest Arkansas.  This is because the numbers below are just for the cities involved…rural, outlying areas, and smaller satellite cities change the figures when put into the greater Northwest Arkansas equation.

As usual, number gurus can cross reference the numbers above with past months numbers to see the nitty gritty details.  For the rest of us, here are the graphs.

Northwest Arkansas Pendings, Solds, and Expireds by Month for 2009

Sales up, pendings down a bit but still up, and expireds down…pretty good news for sellers.

Current Inventories in each Northwest Arkansas City by Month

Not to much we can deduce here except that inventory levels will probably remain stable as both supply and demand increase over the next few months.

Average Days on Market by City

Every city went down from last month except Bella Vista and Springdale.  I expect the days on Market to stay relatively level for the next few months as more homes come on the market and homes that have been on the market for a long time finally sell off.

Absorption Rates by Price Range

I think this is one of the best (and most telling) signs of a recovery.  As absorption rates fall by leaps and bounds we see a healthy market come back into focus.  Based on these number I would say the bottom of the market was in February 2009.  Certain neighborhoods and price ranges obviously differ, but everything points to the bottom being in February.  As absorption rates fall you will see prices stabilize more and demand creep back up to the level of supply.

Have a statistic that you want to see in the Report?  Need a little more explanation?  Would you like this information in pdf or word document form?  Contact us and let us know or leave a comment below.  Thanks for reading and we’ll see you back here next month for the Residential Real Estate Market Report for Northwest Arkansas.

No related posts.