story by Ryan Saylor
rsaylor@thecitywire.com
Home sales in the Fort Smith area continue to show growth year to date, with Crawford County's sales volume up 40.25% and Sebastian County sales volume up 7.29%.
For the first seven months of 2014, Crawford County has posted $40.314 million in sales versus $28.745 million during the same period in 2013. Sebastian County saw sales of $103.748 million so far this year versus $96.702 this time last year.
July, the most recent month sales figures were available, showed a 13.62% increase in sales for Crawford County to $6.25 million, while Sebastian County's total was down by 1.02% to $18.616 million.
Mont Sagely, the principal broker and owner of Sagely & Edwards Realtors in Fort Smith, said the sales figures for the year are a welcome change.
"That pleases me that Crawford County has started to come back because Greenwood, Alma, and Van Buren (have) been sluggish for the longest time," he said.
The rise in home values, Sagely said, also show that the economy locally is starting to pick up pace with the rest of the nation in terms of jobs and economic development.
"In the River Valley area, it's always been a lagger in keeping pace with the (national) economy," he said. "So I think what we're seeing is finally what the rest of the nation has been seeing. Like when we saw the downfall, we didn't see it as fast as the rest of the nation did. But we're finally reaping the benefits of the strong sales across the country. I think that is probably the reason why, because these two counties have always been slow to respond to the national economic trends."
Even with the improvements, he said it is still a buyers market as evidenced by median sales prices.
In Crawford County, the median sale price for a home this year is $105,000, which only represents a $1,000 increase from the same period last year. In Sebastian County, the figure has held at $115,000 since this time last year.
"There are some signs that the market is catching in certain price ranges, but overall it hasn't turned over to a seller's market by any means," he said.
What could eventually start to impact the local market is the loss of Van Buren's Rural Development Loan eligibility starting Sept. 30. Sagely said he does not necessarily think the loss is going to produce dramatic shifts in sales volume, but it would be felt in Van Buren.
Steve Echols, a mortgage lender with Benefit Bank in Fort Smith, said buyers seeking to stay in Van Buren will just need to work harder to get into a home and look at other loan options. He said the most likely alternative to the Rural Development loan would be an FHA loan.
"Probably the next friendliest is the FHA loan, which is 3.5% down versus the zero down the RD offers," he said. "Then there are also 3% down conventional loans. The main difference is the credit qualifying (for a conventional loan) is a little more restrictive."
He said cost-wise, there was not much difference in the two when factoring the lower interest on FHA coupled with its higher mortgage insurance costs relative to a conventional loan with 3% down. But for buyers in Van Buren still looking to lock in the Rural Development loan with zero down, he said there is a limited amount of time.
"The way we understand it, the submission to the Rural Development office should be made by September 30. So that would be a complete application package to Rural Development which would include an appraisal. Those take 10 days to two weeks (to complete). So I would say as September comes and as you get closer tot he 10th of the month or so, that's when you're going to have a difficult time getting the appraisal back to get it all in order for the submission. But as long as the submission is made by Sept. 30, then you are potentially in advance of the cutoff."
As for whether the loss of the Rural Development loan would hurt Van Buren and Crawford County sales, Echols said it likely would not make a huge difference.
"I think ultimately the people that need and desire an RD loan, they'll go find it. If that means going to Alma or Cedarville, they'll do that. But those that want to be in Van Buren or like communities, then they'll use an alternate loan program. I'm sure it may impact the numbers some, but ultimately where there is a will, there is a way and people will conform."
Home Sales Data (January - July)
• Crawford County
Unit Sales
2014: 352
2013: 268
Total Sales Volume
2014: $40.314 million
2013: $28.745 million
Median Sales Price
2014: $105,000
2013: $104,000
• Sebastian County
Unit Sales
2014: 781
2013: 696
Total Sales Volume
2014: $103.748 million
2013: $96.702 million
Median Sales Price
2014: $115,000
2013: $115,000