October Housing Market – Things are looking better
The state of Arkansas, and the nation, are seeing some consistent positive housing activity. Arkansas experienced a slight increase in the number of homes sold statewide in October 2012. The number of homes sold in Arkansas in October rose by almost 6% over October 2011, while the average price of those homes sold rose by over 7 percent. The average price of the homes sold in the 43 county area surveyed by the Arkansas REALTORS Association increased from $145,959 in October 2011 to $157,267 in October 2012.
Pulaski county experienced an increase of almost 14% in the number of homes sold over October 2011, with a 4% increase in the average price of those homes sold.
Year to date, the state has experienced a 2.4% decrease in the number of units sold compared to the same time in 2011, but the average price index has increased over 10%. Pulaski county has experienced increases in both units sold and average price YTD compared to 2011.
According to CNNMoney, in another sign of a housing market rebound nationwide, home prices posted the biggest percentage gain in more than two years in the third quarter, according to the closely followed S&P/Case-Shiller index.
The 3.6% increase from a year earlier is more than three times the rise in the previous quarter and was the biggest jump in prices since the second quarter of 2010. But that 2010 rise was much more of a temporary blip caused by a homebuyer’s tax credit of up to $8,000 on homes purchased in late 2009 and early 2010.
This latest rise comes as the housing market has shown numerous other signs of recovery in recent months. The rebound is spurred by a combination of record low mortgage rates, an improving jobs market and a drop in foreclosures to a five-year low, reducing the supply of distressed homes available. There is also a tighter supply of both new and previously owned homes on the market.
These numbers are through October 2012 only. Our local market activity seems to have come to a hault in November and with very little pending contract activity in November, I don’t see heavy closing activity for December either.
Seeing positive numbers are great, but these numbers are positive compared to the bottom of the barrell. We are nowhere near the peak activity. I believe we are beginning a recovery nationwide, but remember that Arkansas always ‘lags’ behind the rest of the country concerning these indicators. When the nation reached it’s bottom in 2009, Arkansas didn’t reach it’s bottom until 2011. Arkansas is seeing some positive activity, but it may be a few more years before we see a true recovery in Arkansas. I pray that the Arkansas market holds on to the coat tail of the national market and enjoys the ride.