Northwest Arkansas showed a significant increase in building permits issued and existing homes sold in the second half of 2015 compared with the same period last year, according to the Skyline Report from Arvest Bank.
The area also recorded its lowest level of residential lot supply since 2007, with only 48.3 months' supply remaining in active subdivisions in northwest Arkansas.
The Arvest Skyline Report is a biannual analysis of the latest commercial, single-family residential and multifamily residential property markets in Benton and Washington counties.
"Steady, incremental growth continues to be the story in northwest Arkansas' residential real estate," said Kathy Deck, lead researcher for the Skyline Report at the Center for Business and Economic Research at the Sam M. Walton College of Business at the University of Arkansas. "As demand has grown along with an uptick in the economy, developers and contractors are expanding their supply of housing to meet the needs of families moving into and within the two county area."
The average sold price of Benton County homes during the second half of 2015 was $206,575, up 3.1 percent from the average sold price during the first half of 2015. In Washington County, the average price of existing homes sold was $189,093, down 2.9 percent from the average sold price in the first half of 2015.
In total, 4,257 existing homes were sold in Benton and Washington counties during the last six months of 2015, an increase of 15.3 percent compared to the same time period of 2014.
"As the number of existing houses sold continues to climb along with the number of building permits, it is apparent that people are in the market for new homes," said Jeff Resler, Arvest Mortgage Loan Manager for Benton County.
Using the absorption rate from the past 12 months implies that there is a 48.3-month supply of remaining lots in active subdivisions in northwest Arkansas, the lowest level since 2007. But an additional 5,113 residential lots have received either preliminary or final approval in the two counties. Adding those proposed lots extends the supply to 76 months.