Welcome to your March Northwest Arkansas Market Update

This market is going to be an interesting and surprising ride. February closings beat January but that wasn’t difficult with the bar set so low. Prices are up year over year but how much? There were 659 residential closings in Benton and Washington Counties for February. This is a 20% drop compared to the same time year before. Year to date the number of sales are down a little under 30%. We will have to watch the next couple of months as we enter our strongest selling season here in Northwest Arkansas.

We saw lots of buyers jump on board the lower rates for January and early February and take advantage of them. Want to remind everyone last week we saw rates hit above 7% again but there are a ton of ways to get that rate down into the low 6% range so don’t be stickered shocked with the number. The average home sold for $390,000, just over 2000’, and for $186 p/ft.  This is an 8% increase year over year. As prices flatten out, we expect this year-over-year number to come down. There are a lot doom and gloom news articles out there but remember real estate is local and many places do not have the advantages that we have. With that in mind many experts are predicting appreciation in our area in the 3-5% range. We are fortunate to be in Northwest Arkansas. We have great job opportunities and still affordable compared to the rest of the country.

Right now, we still have less than 3 months of inventory on the market, and buyers are hungry for new listings. So if you have a home to sell…. There is a buyer waiting for it. The average days on market from listing to close has increased to 86 days. So, make sure you plan accordingly with your agent.  We always watch the new pending contracts to have a little glimpse into the future. February recorded 912 new pending contracts this almost matched our 2022 pending contracts for the same month. March should be a solid month for closings. There has been a lot of pent-up demand from buyers holding out in the 4th quarter last year and we are seeing that activity now.

Let’s talk for a second about what we know and what we are seeing. The real estate market and how it effects price is all based on supply and demand. The number of total sales is down around 30%. We had 825 New listings came on the market in February. There were 912 new pending contracts. What this is currently telling us is that although demand has dropped, we still have enough demand to keep up with the current supply coming on the market. This will keep prices stable until one of two things happen. Number one a rush of new inventory. Which we do not see coming. Many sellers have rates in the 2 and 3 percent range that we may never see in our lifetime. We the idea of trading for a normal rate near 6% can be tough. Or if number 2 buyer demand drops further. This hopefully doesn’t happen as Northwest Arkansas still has an influx of people moving in daily. This is going to be an interesting year for real estate and interest rates will have a lot to do with it.

Personally, I believe Northwest Arkansas is a great place to own and invest in. If you are leasing and can afford to purchase, talk to a trusted real estate agent, as we still see prices rising. If you are a seller and have a reason to move, let’s get your home on the market as there are some buyers waiting for it. Hope you have enjoyed this feel free to reach out anytime to talk about real estate.