FAYETTEVILLE -- Residential home sales in Benton and Washington counties hit a record in the second half of 2020 and sale prices also topped previous highs despite the covid-19 pandemic, according to the Skyline Report released on Tuesday.
There were 5,726 homes sold in the two counties for the period, the largest since the report began in 2005. The number of sales were up nearly 17% from the July through December period a year earlier and nearly 35% from the last half of 2015.
The sale prices of homes also topped previous years. The average sale price for homes in Benton County was up nearly 11% to $293,403 when compared to the second half of 2019 and up nearly 42% from the same period five years ago. Sale prices in Washington County stood at an average of $268,987, up almost 12% from the the last half of the pervious year and almost 43% from the same period in 2015.
Mervin Jebaraj, director of the Center for Business and Economic Research at the Sam M. Walton College of Business at the University of Arkansas, Fayetteville and lead researcher for the report, said in an interview Tuesday that Benton and Washington counties are seeing a strong seller's market driven in part by buyers wanting and needing more space because of the covid-19 pandemic. He said low mortgage rates are likely another factor in driving buyers into the market.
Mortgage rates remained near historic lows last week, with Freddie Mac reporting the average benchmark 30-year fixed rate home loan was 2.9%, up from 2.81% the week earlier. The average rate stood at 3.45% a year ago. The average 15-year fixed-rate loan was 2.34%, up from 2.21% a week earlier.
The Skyline Report examines the residential, commercial and multifamily real estate market in Benton and Washington counties. Researchers at the University of Arkansas, Fayetteville's Center for Business and Economic Research compile data for the report. Arvest Bank first sponsored the Skyline Report in 2005.
For the first time, Tuesday's report included residential market information on Madison County as well. In Madison County 77 homes sold during the second half of 2020 at an average price of $203,285 after spending an average of 77 days on the market.
Residential inventory remains tight according to the report, with the number of homes for sale during the second half of 2021 down 61% to 707 and the number of completed but unoccupied homes down just shy of 21% at 245. New construction appears to be picking up to fill the gap with new residential building permits standing at 2,030 for the last six months of 2021, the most since 2006.
Vacancy rates in the multi-family segment were slightly higher for the end of 2020 with several large development projects making more space available, Jebaraj said. Rates ticked up to 5% for the period, up from 4.8% for the same time a year ago on the strength of available space in Bentonville and Rogers while vacancy rates dropped in Fayetteville, Springdale and Siloam Springs.
The average lease rate per month for a multifamily property in Benton and Washington counties was $741.36, up from $729.82 in the first half of the year.