Hawks’ View
October 21-27, 2024
By Spencer Hawks
The new pool liner is in, fall baseball season is finishing up, and our little subdivision had its autumn gathering yesterday evening. Every indication that the season should be changing is present, except for these 90-degree Saturdays in the middle of October. If Mother Nature is a reader of this article, maybe she’ll turn the thermostat down. I prefer warm weather though, as unseasonal as it may be. I find that warmer weather keeps the real estate market more active than colder weather does, so I’ll take what I can get. Plus, I’d much rather coach baseball in warm weather than in the cold.
I’ve been helping coach Sebastian’s baseball team this fall and have learned more about the game this year than in year’s past. Since baseball is still on my mind, let’s think of the housing market as a baseball game. The Federal Reserve is the umpire, making calls on interest rates based on the changing conditions of the economy. When inflation was pitching home runs in the housing market at 3.7% or better, the Fed tightened the game, just like an umpire calling a close strike. Now that inflation has cooled to 2.4%, it’s like a pitcher throwing strikes with finesse; the Fed is looking for that sweet spot of 2% as their ideal target.
The Metro Region sold 102 fewer homes this year than at the same time last year. The average price of a home in the region is $289,617. Putting this into perspective, that’s nearly $30 million less in residential real estate activity. Last year at this time, there were nine houses that sold for over $1 million. This year, there were ten. This has been fairly consistent over the last few months. However, the drop in homes under $250,000 makes a much larger statement. The number dropped from 573 last year to 473 this year, a loss of 100 units. This trend, too, has been fairly consistent.
Looking outside the Rock, here are the details on other communities. Conway sold 66 homes with an average sold price of $283,696, with an average square foot price of $147.43 a square foot. The average home in Benton however was only a couple thousand dollars more at $285,197 or $141.44 a square foot. Cabot sold a whopping 82 units at an average price of $266,761 or $142.44 a square foot. Note the delta on the price per square foot between Conway and the other two communities. Where Conway excels is in the homes between $300,000 and $600,000, outpacing Cabot and nearly doubling Benton. Benton had more homes over $600,000, with four to the other communities two.
I’d like to congratulate my friends at the Janet Jones Company for having both sides of the highest-priced residential transaction over the last month and the only transaction over $2 million. All transactions over $1 million in this dataset occurred in Pulaski or Saline Counties.
Now back to baseball! Those homes under $250,000 are base hits critical for keeping the lineup moving and the economy energized. Losing 100 of these units is akin to a team losing its top hitters; it stifles scoring opportunities and slows down the momentum of the market. Meanwhile, the high-end sales—those over $1 million—are like home runs: exciting but not frequent enough to change the overall landscape of the ballgame.
As unemployment continues to drop to 4.1%, it’s like a solid defensive lineup holding strong. In this economic game, the interplay of inflation, employment, and housing sales is key. Just as a team adjusts its strategy throughout the season, so too must buyers, sellers, and policymakers respond to the dynamics of the market. While coaching the Hawks Family Team Yankees, we’ve moved an outfielder to pitcher and occasionally played our fielders deeper in the field when facing those big hitters. One thing I’ve learned about Conway 8U Fall-Ball is that some teams have more kids who are six, while others have more that might start shaving before long. Real estate professionals, lenders, and others in the game need to make adjustments with their clients as well. This season, I brought in the pros to help me coach: two mentees from my youth-worker days, Jordan Pate and Mason Shelton, who are far more knowledgeable and athletic than I am— plus, they’re younger. If you’re looking to get in the game as a buyer or a seller, it’s time to line up behind true professionals who know how to handle this new pitcher throwing strikes.
In a few weeks, I’m going to Boston with thousands of other REALTORS from around the country and the globe. My associate Landen Haas, who put one under contract as I was writing this paragraph, is excited to see and hopefully meet baseball legend Big Papi, David Ortiz, who is headlining the event. It will be intriguing to discuss these economic issues with my colleagues from across the country. That said, with warmer weather stretching the season a bit longer here in Arkansas, perhaps we’ll see more players in the real estate game before the cold weather truly sets in. Play ball!