February home sales up 12.6%; prices drop

Home sales in Arkansas jumped 12.6 percent in February and home prices fell almost 3 percent compared with February last year, the Arkansas Realtors Association said Friday.

The report signals steadily increasing home sales, economists said. Sales are up 13.4 percent during the past 12 months, compared with the previous 12 months.

Michael Pakko, chief economist at the Institute for Economic Advancement at the University of Arkansas at Little Rock, called it “a very strong report.

“It is still early in the year,” Pakko said. “And sales are low compared with later in the summer. But for the second month of the year, it was good, particularly when you consider the [winter]weather.”

There were 1,793 homes sold in February in the 43-county area covered by the Realtors Association’s monthly report.

Nationally, previously owned home sales in February dropped to an annual rate of 4.6 million, according to the National Association of Realtors. That was the lowest level since July 2012.

In Arkansas, Benton County Realtors had the strongest February, selling 292 homes, up almost 25 percent compared with February last year and higher than any other county in the state.

Sales in Pulaski County, the state’s most populous county, totaled 274 houses, basically unchanged from February last year.

Four of the top 10 counties reported declines in sales - Sebastian County, down 13.5 percent; Washington County, down 5.4 percent; Lonoke County, down 4.7 percent; and Pulaski County, down 0.7 percent.

The two largest metropolitan areas in the state - Northwest Arkansas and the Little Rock area - had similar gains in sales, Pakko said.

Benton and Washington counties’ combined sales were up 12 percent and the Central Arkansas counties also were up about 12 percent, Pakko said.

The average sales price throughout the state was $146,902, down about 3 percent from February last year.

The drop in home prices was one disadvantage for February, said Marc Fusaro, an associate professor of economics at Arkansas Tech University.

“One of the ways we’re getting these units sold is that we continue this trend of sellers being willing to take lower prices,” Fusaro said.

There have been normal fluctuations in interest rates, said Scott McElmurry, chief executive officer of Bank of Little Rock Mortgage, one of the largest mortgage lenders in central Arkansas.

“Interest rates have been up or down by an eighth of a percent or a quarter of a percent,” McElmurry said. “They haven’t moved enough to fuel a reason for sales to be up [12.5 percent].”

Home sales were affected dramatically by winter weather in February, said Roddy McCaskill, the executive broker with Keller Williams Realty in Little Rock.

“[February] was a trickle along month,” McCaskill said. “We’d have a warm day and everybody would get out and look at houses. Then you’d have the ice and snow, and everything would shut down. Sellers don’t want to get out of their house and you’re reluctant to take buyers out when it’s icy.”

Business, Pages 27 on 03/29/2014

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