Straight Shooting Real Estate

Well, it’s another week and I’ve put together another housing market report for the Arkansas Realtors Association which is surprising.

What’s surprising about it? Once again, average list prices went up in spite of reports of slowing sales throughout the state. Average list prices have been on the rise since January, but you’d expect the reverse to be true due to the aforementioned reports of slowing sales.

What, then, could be causing list prices to increase when one would assume the reverse should be the case. You’d expect inventories to decline in response to dropping list prices, but that’s not happening at all.

The only reason I can find to explain it has to do with something an appraiser mentioned last week — sellers in Arkansas aren’t desparate. Sellers who are panicked tend to list their homes at the lowest price point possible in hope of getting out of their mortgages. There’s no doubt that some sellers are in that boat in that they’re worried about making those mortgage payments, have to leave the area in a hurry due to a job change, etc.

Still, the average homeowner appears to either choose not to list a home at all or, at least, list it in line with fair market value (a measure that hasn’t decreased dramatically in most Arkansas markets over the past few months, by the way).

The appraiser’s comment goes hand-in-hand with something a Realtor mentioned the other day. There are plenty of buyers making offers that border on insulting in hopes of finding bargains. The homeowners, on average, are refusing those offers and are hanging on to their homes until they get the prices they need.

Furthermore, Realtors have mentioned that they’ve been very busy as of late. It appears that low mortgage rates and that $8,000 tax credit for new homebuyers have combined to spark the interest of buyers. It could also be that sellers are encouraged by those factors, too, and are hoping to sell their homes for good prices.

At any rate, it is refreshing to see average list prices increasing a bit as the number of homes for sales remains flat or drops a bit.

The report on which this post is based covers the list prices and number of new and existing, single-family homes for sale (inventories) in central Arkansas, the Fort Smith/Van Buren area in western Arkansas, the Jonesboro market in northeast Arkansas and the northwest Arkansas area (Benton and Washington counties only).

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