Crye-Leike CEO Harold Crye comments on 2012 real estate market in this story published by TheCityWire in NorthWest Arkansas
The local housing market has dominated headlines for the past decade and the news has been mixed. There were unbelievable highs through 2006 to the doldrums of 2009 and then the foreclosure havoc through 2011. But experts agree 2012 was the best on record since prior to the great recession.
George Faucette, CEO of the local Coldwell Banker franchise, said it was his firm’s “best showing in a long time.”
Linda Marquess, agent with Crye-Leike Real Estate, did better than that, saying 2012 was the most successful year she has had in a 41-year career.
Marquess closed 119 sales in 2012, 96 were new home constructions built by industry veteran Mark Marquess who is working in three subdivisions located in Fayetteville, Rogers and Bentonville.
“It’s been an incredible year and we expect a repeat performance in 2013, based on the feedback and preorders we are getting for new homes,” she said.
Paul Bynum, statistician with Mount Data, reports agents across Northwest Arkansas sold 427 homes in December. That equated to 271 in Benton County and 156 in Washington County. The total value of those transactions was $71.518 million, up 9.19% from the year-ago period.
Faucette said market activity did slow some as the year wound down, but there continues to be several good trends in play.
“The lot overhang is being sold off, construction pace has been steady, those new homes are selling and the inventory of existing homes and distressed properties has come way down. This has helped to push average prices up nearly 20% in 2012,” Faucette said.
He said his firm posted a 16% increase in units sold in December, while the overall local market sold 4% more homes than a year ago.
The big story in 2012 was price recovery, which helped to push the full-year home sales beyond the $1.05 billion mark for the first time in four years across Northwest Arkansas.
Mount Data reports 6,053 homes were sold in Benton and Washington counties in 2012, this was up 3.55% from the prior year. But the total value of sales rose 17.8% from the 2011 year-end.
“Our gross transaction values rose 29% in 2012 which is incredibly exciting,” Faucette said. “The average ticket price for homes closed by our agents rose $20,000 in 2012, from the prior year.”
He was quick to say it does not mean everyone’s home value rose that much in 2012. But he said like product values did rise roughly 4% across the market which was a welcome sight after several years of downward pressure.
“We were fortunate to see more higher-end home sold this past year and fewer distressed or lower-end properties, which is the reason for the hefty spike in average home prices,” Faucette said.
He does expect to see the recovery continue in 2013 with home prices rising somewhere between 3% and 5%, barring there is not another economic calamity from debt ceiling or spending cut issues still being debated in Washington.
Harold Crye, CEO of Crye-Leike Real Estate, agreed that 2012 was a better year for the housing industry and his firm in particular.
“Crye-Leike finished 2012 strong, up in sales approximately $700 million companywide over 2011 figures and Crye-Leike was also up in the number of properties sold in 2012 finishing out the year selling 28,065 units up from selling 24,470 units in 2011,” Crye said.
“It’s best year in sales since 2007 when we had a $5.7 billion sales volume,” said Crye. “There were lots of positive things that happened for the housing industry in 2012 and we expect to see many more great real estate improvements in 2013.”
Crye predicts there will be an increase in sales, consumer confidence, new home construction, price appreciation, multiple offers on homes and a decrease in REO (real estate owned) sales by banks.
Locally, Crye said, sales volume for 2012 was $303.387 million, one of the best since expanding here from Little Rock in 2008.
Bynum says the market fundamentals that monitor supply and demand are in near balance for a stable and healthy diagnosis at the end of 2012.
He said inventory totaled 3,178 homes, down 300 from the prior month and 56% below the historic high in August 2007. Inventory is down 10% from a year ago.
For new construction, Bynum said volume in 2012 was $189 Million, up 40% over 2011. Agents like Marquess sold 793 units, up 34% from 2011 levels. The median sales price for new home sales was $215,000, up 2% from 2011.
Of the 6,053 homes sold in 2012, Bynum said 12 of them were valued in excess of $1 million, but the majority of sales (793) ranged between $75,000 and $100,000. Bynum notes there is a 5- to 7-month supply of homes priced under $150,000 – a value deemed the affordable price range for the local median income.
The median home price for the full year of 2012 was $142,000, up from $120,000 in the prior year. This pushed median price-per-square-foot up to $81, the highest level since 2007.
2012: 3,809 units, $683.830 million
2011: 3,594 units, $568.069 million
2010: 3,290 units, $541.463 million
2012: 2.254 units, $374.457 million
2011: 2.259 units, $332.189 million
2010: 2,083 units, $322.256 million
Median Sales Price