2021 is off to a fast start in Northwest Arkansas Real Estate. In January, we’ve seen increases in Sales, Pendings, and also in Listings (thankfully!) I’m hoping we can get more homes coming into the market as we get closer to Spring. Rates are staying low, and it remains a great time to sell.
Here’s the NWA Residential Market data from right before the pandemic was announced in March until last week. Notice the reversal of the two blue lines (New Listings and Pendings) above the red line (Sold homes). This is a very positive indicator that we may be getting more balance back into the market. For a while, we were outselling our inventory replacement levels.
As I predicted, we have seen an increase in listings here at the beginning of the year. However, we are still seeing more homes going pending (Light Blue line) than the number coming into the market. So, I still expect prices to keep rising. With the continued demand from Buyers, I expect more upward pressure on home prices this year.
As of February 3rd, we only had 631 houses in the market, so we still have less than 1 Month of Supply right now. That’s keeping our prices high.
As you can see below, the downward inventory levels (Green line) started to bump back up this month. Next month, the sale numbers should follow that trend with a bump upward as well. However, the inventory is still far lower than previous years, and I’d expect sale numbers to continue to outpace previous years.
Our average sale price stayed right around $278,000. That’s about where we were in December, so prices stayed pretty high through the traditionally slow months of December and January. Again, I expect them to go higher from here. This could be the pricing floor that 2021 builds upon.
What it all Means for You
While it seems like Real Estate has been booming, the sad reality is that these prices have only been climbing so high due to an imbalance between supply and demand. Especially, in the starter home category, we’ve seen prices climb so high that many first time homebuyers have been priced out of the market. For their sake, I really hope we can get some more affordable homes into the market soon.
However, many people who would traditionally need to sell because they can’t afford their payments are just staying put due to the mortgage moratoriums. And the new administration has proposed extending those moratoriums through the end of the year. They’ve also proposed ending the 1031 exchanges, which allow investors to sell rental homes and buy other similar properties without a large tax bill. That means there will be a dis-incentive for selling rent homes back into the market. So I predict the inventory will remain low for at least the rest of 2021. Beyond that, who knows!
If you’ve been thinking of selling your home, right now is a historically good time to do so. You’ll sell quickly with a high price. But then you run into the problem of finding your next place. And that’s the big issue, the main problem to solve this year.
Remember the “Hidden Homes” Move-Up Program!
The single biggest problem with Real Estate over the last year has been a lack on homes in the market. So many people would love to move into a new home that better suits their needs, but they’re afraid to sell their current home. It’s tough to make that transition if you don’t know what else you’re going to move into.
For this reason, I’ve put together a program to find “Hidden Inventory, Off Market Homes” for my clients.
This is my #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!
Just click here to learn all about the “Hidden Homes” Move-Up Program!