May 18 2009
What a difference a year makes
A look at average list prices and the number of homes for sale over the past year reveals a trend that’s worth noting — average list prices throughout Arkansas have increased over the past year as inventories have decreased.
The chart above tells the story and it really should come as no surprise — the time-honored law of supply and demand suggests that the average asking price of a house (or anything else) will increase when there are fewer homes on the market.
Some people, of course, might question whether inventories have declined because more people are buying homes or because people are choosing not to list their houses until they believe the market has improved. Truth be told, it doesn’t really matter as far as people in the real estate industry are concerned. People have been worried about high inventory levels for close to two years now, so any sign that the number of homes for sale is declining is encouraging.
It’s too early to start pointing to a trend, of course, but we’re certainly keeping an eye on inventories and average prices here at the Arkansas Realtors Association. Hopefully, we’ll see further declines in inventories around the state and more upward pressure on list prices.
As for how the average/median list prices and homes for sale fared this week, the chart below should explain it all.
Every week, the Arkansas Realtors Association collects and distributes the average and median list prices and the number of homes in inventory (homes for sale) for single family, new and existing houses in four markets. Those markets are Benton and Washington counties in Northwest Arkansas, the Fort Smith/Van Buren areas (Crawford and Sebastian counties) in west Arkansas, the Jonesboro area (Craighead County) in northeast Arkansas and the Little Rock-North Little Rock-Conway Metropolitan Statistical Area (Faulkner, Grant, Lonoke, Perry, Pulaski and Saline counties) in central Arkansas. While those four markets don’t tell the whole story, looking at them together gives us a pretty good idea about developing trends in markets throughout the state.
I’m sure we all do, Danny. Here’s the question — the recovery will come in small increments rather than the “boom” some people seem to be expecting.
How, then, will we know for sure that things are improving out there?