story by Kim Souza
ksouza@thecitywire.com
Realtors and real estate professionals across Benton and Washington counties tallied up another solid month of home sales in October, helping to push the 2014 year-to-date comparison ahead of last year.
Agents sold 689 homes last month, which was 16% more than sold in October 2013, according to MountData.com. The total sales volume recorded last month rose to $138.27 million, a gain of 33% from the year-ago period. Through the first 10 months of 2014 sales totaled $1.176 billion in the two-county area, up compared to $1.13 billion in the same 10-month period last year.
In Benton County through October agents sold 3,950 homes valued at $771.07 million, a value gain of 5.6% with near-flat unit sales compared to the prior year period. Median home prices rose 3.3% to average $85.70 per square foot.
Washington County had 2,247 home sales through October with a value of $405.85 million. This compared to 2,314 sales worth $408.02 million in the same period last year. While sales were slightly below last year, the median prices in Washington County were stable, rising just 1.3% year-over-year with a median price per square foot at $87.70, MountData.com reports.
“It’s been a really good year for me. I am somewhere around $5 million in sales and people are still calling wanting to look and make deals. My last closing was Friday and I really thought that would be it for the year, but then two people have contacted me wanting to make offers already this week,” said Tami Fagan, agent with Crye-Leike Real Estate in Fayetteville.
She said there are buyers young and older looking for investment properties, like the recent college graduate she sold a small home to in Fayetteville.
“He graduated last year and found a job locally. He got a 3.78% interest rate and his payment is lower than rent. To top it off the loan he got is assumable, and I haven’t seen one of those in a very long time. His plans are to live there for a few years and then rent it out if he takes a job elsewhere or decides to move up,” Fagan said.
This type of activity from the Millennial demographic somewhat contradicts what is talked about often in the national media that depicts Gen Y as agnostic toward homeownership and more apt to rent for longer periods of time.
“That may be true nationally, buy I sell a lot of houses to young people who see it as a chance to build some equity as opposed to renting. They are usually careful to buy lower priced homes in trendy neighborhoods that can easily be rented if they decide to move,” she added.
HOME PRICE INCREASES
Fagan said there aren’t nearly as many foreclosures and short sales on the market today and prices on the whole are trending up. With that she said there is still homes in the $125,000 to $140,000 in west Fayetteville and east Springdale. She said there are some values in Bella Vista, but Bentonville remains more expensive.
“The appraisal values are starting to come up. In most of the I homes I’ve recently closed, the appraisals came in at least $5,000 over the contract price. That’s always good news for the buyer,” she said.
Charles Hudson Sr., owner of Hudson Appraisals in Rogers, said 2014 is the best year he’s had in the past three.
“My business took off in February and it hasn’t slowed down. Between all the new construction in Benton County and a very active real estate market for existing homes, it’s been a very good year,” Hudson said.
MountData.com reports home prices in Benton County averaged $207,384 in October, up from $175,191 in the same month last year. The median price per square foot rose to $87.3 in October, up 9.5% from October 2013. Year-to-date the median price per square foot for homes sold in Benton County is $85.70, up 4% from 2013 and a 10.5% improvement from 2012.
“For five or six years foreclosures were the key to our market values, but the dwindling numbers have gotten so low that property values in many neighborhoods across the region have stopped falling. There are slight increases showing up in some areas which is being fueled in part from the new construction market,” Hudson said.
He said the bulk of his business is for existing home purchases but he’s getting more new construction jobs for speculative and custom projects. He said the new homes going up in southwest Bentonville are selling.
“In Bentonville near Rainbow Curve out toward Highway 12 there were several subdivisions just sitting there for five years. The streets, curbs and street lamps were in place but they had been baling hay out there for some time. Now there’s building going on again there, and also out toward Highway 102 near Centerton, there’s a slue of new construction,” Hudson said.
Without the negative pull from the foreclosure market, Hudson expects home prices to continue to improve into 2015. He refrained from looking too far ahead saying his crystal ball has been somewhat foggy.
“If the trends I see continue, that’s a growing local population, and sustainable job growth, then I expect 2015 will be a similar, perhaps slightly better year than 2014,” Hudson said.
Home Sales Data (January through October)
Benton County
2014: 3,950 units valued at $771.077 million
2013: 3,927 units valued at $730.045 million
2012: 3,244 units valued at $579.373 million
Washington County
2014: 2,247 units valued at $405.845 million
2013: 2,314 units valued at $408.021 million
2012: 1,954 units valued at $326.687 million