LITTLE ROCK — The number of residential building permits grew and housing prices increased in Benton and Washington counties over the last six months of 2012 after bottoming out then stabilizing in the year’s first six months, according to the Skyline Report released Tuesday.
Kathy Deck, director of the Center for Business and Economic Research at the Sam M. Walton College of Business in Fayetteville, said that between July and December the residential real estate market showed signs of growth despite the year’s sluggish start.
“We’ve turned up,” said Deck.
She said growth was unlike the manic building before the recession hit in 2008. She said the most recent report shows balanced growth in line with market demand.
The semiannual report on the two counties, sponsored by Fayetteville-based Arvest bank, is compiled by the university center.
Residential building permits in the two-county area from July through December totaled 980, an increase of 53 percent compared with 642 for the corresponding period in 2011. The average value of the building permits for the last half of the year was $236,731, up 10 percent compared with the average value of $215,127 for the same period last year.
Deck said job growth in the area is spurring demand for new and previously occupied homes.
In December, Arkansas’ unemployment rate stood at 7.1 percent, while the Fayetteville-Springdale-Rogers Metropolitan Statistical Ar-ea, which includes Benton, Washington and two other counties, had an unemployment rate of 5.1 percent, according to the U.S. Department of Labor.
Arkansas’ unemployment figures for January and February will be released later this month.
Benton County saw the most residential permits issued for the period at 641, or 65 percent, compared with 339 in Washington County.
Stephanie Feist, permit clerk for Rogers in Benton County, said the city is seeing similar trends. She said 173 permits valued at $33.6 million were issued during the last half of the year, compared with 138 permits valued at $28.3 million for theprevious six months.
She said that for the first two months of 2013, the city issued 71 residential building permits, a nearly 130 percent gain over the 31 issued in the year-earlier period.
In the six months ending with December, 2,982 houses were sold in Benton and Washington counties, anincrease of less than 1 percent over the last six months of 2011.
The average sale of new and previously owned houses in Benton County at theend of the fourth quarter was $186,963, an 8 percent increase compared with the end of the second quarter. The average price of previously owned homes sold in Washington County at the end of the fourth quarter was $174,153, up 8 percent compared with the end of the second quarter.
George Faucette, co-owner of Coldwell Banker Harris, McHaney and Faucette, which sells homes in both counties, said new construction and fewer foreclosures entering the market because of legal issues at the federal and state level skewed housing prices higher for the second half of the year.
“I don’t think we’ll see as dramatic a price increase this year,” he said, predicting a 3-to-5 percent gain in 2013.
He said interest rates for mortgages are low, but that is tempered by more-stringent lending requirements from banks that are looking harder at credit scores and demanding larger down payments.
Average U.S. rates on fixed-rate mortgages as ofThursday remained close to historic lows. According to mortgage buyer Freddie Mac, the average rate on the 30-year, fixed mortgage edged up to 3.52 percent from 3.51 percent last week, near the 3.31 percent rate reached in November - the lowest since 1971. The average rate on the 15-year, fixed mortgage held at 2.76 percent. The record low is 2.63 percent.
Faucette said the Northwest Arkansas market is stabilizing after the boom and bust years of the past decade.
“We’re getting to the point of a reasonably balanced market,” he said.
Home value per square foot increased in both counties. The average cost per square foot of houses sold in Benton County by the end of 2012 was $80.56, up 12 percent compared with $71.86 at the end of 2011. In Washington County houses sold for an average of $84.12 per square foot at the end of the fourth quarter of 2012, up 13 percent from $74.74 compared with a year earlier.
Business, Pages 29 on 03/13/2013