Happy Holidays, everyone! And here in Northwest Arkansas, we had a Thanksgiving Shocker in the Real Estate market, as our Average Sales prices shot all the way up to nearly the same level as our Pricing Peak from this Summer!
Also, Mortgage rates have begun to fall at the fastest pace since 2008.
As you can see here, our Inventory is now around 5 months of supply, which is a slight a Seller’s Market verging on being more neutral than what we’ve seen most of the year.
In this next chart, you can see the number of Active/Pending Homes in November staying around our levels from July, August, and October coming in at 3,365 homes in the market. This is also pretty comparable to the peak inventory levels of the last two years, but we’re still nowhere near the peaks of more normal years like 2018 and 2019, which were over 4,000 homes in the market. So, we’re still dealing with lower inventory, low supply in our market. Our number of Closed transactions is starting its normal End of Year dip, coming down to 694 sales in November. So overall, inventory is slightly up and closings are going a little lower, which is to be expected this time of year.
As for how long properties are staying in the market, November’s Average Days came in at 78. So we’re getting back to more typical timeline to sell a property, similar to what we were seeing before 2020. This is generally good news for buyers because the longer homes sit on the market, the more willing Sellers are to negotiate better prices and terms.
However, Median Days-on-Market dropped all the way back down to 47 Days. And with a 30-45 Day Closing period for most transactions, this means that at least 50% of homes are still finding a contract within the first few weeks of being listed.
Now, the big shock to the system that I wasn’t predicting, was that our Average Home Sale Price in November jumped all the way up to $435,000! That’s pretty much matching the prices from the peak of our Summer Selling Season, which is usually the busiest time of year, with the highest prices.
Median price stayed even with the last three months at $350,000.
Now, as I’ve been saying, I expect this average pricing level to continue at or above $400,000 as we move through this Winter. With the holiday gift of lower interest rates, we may even see home prices move higher during this time. I honestly wouldn’t be surprised. More on those rate adjustments in just a minute.
Average Prices Per Square Foot stayed around $200/SqFt this month.
Mortgage Rates kept rising this year, but they peaked out in October at around 7.8-8%. Upon the news that the Federal Reserve is pausing rate hikes, the bond and mortgage markets reacted with a sudden drop in rates. We’re currently all the way back down to 7.03% and the upward trend has clearly been broken. Most analysts are expecting further rate declines as we move throughout 2024.
However, the higher rates have kept many potential buyers on the sidelines this year, creating a dampening effect on the true pent up demand for homes. That’s why we’ve been recommending buyers take advantage of the opportunities we’re seeing this Fall in order to scoop up a good deal. We have more inventory, longer days on market, and sellers are more willing to negotiate as the buyer pool has shrunk. And now with rates on the decline, it may be the best time we’ve seen all year to jump in and grab the home you’ve been waiting for while there’s still relatively little competition from other buyers. If you wait till the Spring, prices will likely be higher than they are now, and the competition for homes will have become much tougher to win.
What it all Means for You
Our Northwest Arkansas real estate market is winding down into the Winter with fewer closings taking place.
We have more homes available on the market than we’ve had in months. And that’s an opening for savvy shoppers. So I’m seeing more price reductions happening, and more room for negotiating with sellers, although average prices even went up this month.
Remember, if mortgage interest rates continue to fall, more buyers will be coming into the market and competing for the homes that are available. So, prices will jump even higher from current levels as mortgage rates come down. Locking in a good price right now may be a smart bet. Then if you can refinance into a lower rate in the coming year, you’ll have the best of both worlds.
Some of our lender partners even have the option to do a free refinance anytime within the next two years, if rates fall substantially.
Also, we’ve put together a program to find “Hidden Inventory, Off Market Homes” for my clients without all the hassle and competition from other buyers.
This has been and will continue to be our #1 Strategy to get you and your family out of your current home and into your dream home. Let’s see what we can find together!
Just click here to learn all about the “Perfect Home Finder” Program!
If you’ve been thinking you’ll wait till next year or later to make your move, I’d like to share a strategy to save you $20,000 to $30,000 and potentially hundreds of dollars off your monthly bills, depending on the equity position you have in your current home. Would that be a conversation worth having? If so, leave me a message below.
To see the strategies we’ve been implementing to sell for the most the market will bear, regardless of the time of year we’re in, Watch our “Pre-Listing Price Accelerator” Guide Here and see How To Maximize Your Home Sale. It will walk you through everything we’ve been doing at the LoneRock Team to get amazing results for our home sellers.
With that being said, I hope you have a great Christmas and New Year’s Eve here in December, go enjoy some time off, and we’ll catch you on the next Monthly Market Update!