Home Sales Drop, But Market Optimism Prevails in Arkansas
October housing sales data released by the Arkansas Realtors Association last month showed a 20 percent drop in the number of Arkansas home sales compared to the previous year.
Pope County numbers showed the largest change, a 36 percent drop compared to October 2005, proof that perhaps the housing bubble has finally burst, according to the Russellville Courier-News.
Local real estate agents aren’t buying it.
“I wouldn’t be concerned that the area is going into a housing recession,” said Brad Neiman of Cliff Goodin and Associates. “Our company has sold more than we ever have this year.”
Rich Vander Leest, owner of Coldwell Banker in Russellville, said the key to the big picture is in comparing year-to-date sales numbers.
“Any one month can be really out of whack,” he said.
Last year was the best year on record for home sales in Arkansas, officials say. With a low cost of living and cheap mortgage loans, more residents found the means to buy homes in the Natural State. According to sales data from the Russellville Board of Realtors, 956 single family and mobile homes were sold during the period of January-October 2005. For the same period in 2006, sales totaled 964.
“It’s going to be a very good year by anybody’s measurement,” Vander Leest said.
Tabitha Davis of ReMax First agreed.
“This is the best year of my career,” she said.
Her total sales, including commercial property and land, are up 18 percent from last year. Area home prices have also increased. The average listing price went up from $101,360 to $108,984 this year. Four years ago, the average sales price for the area was $90,000.
New construction costs increase the price of new homes, which also has a positive effect on existing home prices.
Davis said the area’s slow, steady growth buffered the housing market from wild fluctuations. With Arkansas mortgage costs staying consistent for the most part, and without factors such as rampant investor activity or limited space, the area was shielded from a housing bubble, unlike a Chicago or New York would be.
As for the area’s overall economy, it does seem to be slowing, said Jeff Pipkin, president and CEO of the Russellville Chamber of Commerce.
“But there’s no reason for alarm,” he said. “The end of the year is always slower, and in an election year, it’s slower still. I’m still very excited about growth in Russellville.”