It's time to breakdown the April statistics for the NWA market. Honestly, nothing really jumps out as extremely noteworthy for April. It was interesting to see the median sale price down $15K from last month, but the sale price per SQFT increase $6/SQFT. Meaning, it was likely more smaller houses sold in April than prior months, but that’s not a particularly enlightening fact in terms of market stability.
 
The ratio of sale price to original list price inched higher, 99.9% compared to 99.1% in March. That was a surprise in the sense that based on the number of “price improvement” notifications received in the last couple months, we expected to see the percentage decrease ever so slightly (not go up).
 
Additional signs the market has not experienced a major change yet, the median days to sell actually went down from last month. The months of inventory stayed the same. Expired listings reduced by over 100 from last month. All three metrics showing there are still buyers out there competing for houses.
 
All in all, these numbers are pretty neutral in terms of predicting shifts in the residential sale market. Some up, some down, but nothing screams red flag.
 
Out of curiosity, we looked up how many houses sold as “bank-owned” properties (i.e. foreclosed) or approved “short-sales” (i.e. sale price less than mortgaged amount still unpaid) over the last 10 years. After looking at the data, 3 distinct timeframes stood out as phases in the market: 2013 to 2017, 2018 to 2020, and 2021 to current. Here’s what we found…
 
Bank-Owned Sold Properties:
2013-2017 had 2,991 sold in 60 months, approx. 50/month
2018-2020 had 341 sold in 36 months, approx. 9.5/month
2021-April 2023 had only 41 sold in 26 months, approx. 1.5/month
 
Short-Sale Sold Properties:
2013-2017 had 211 sold in 60 months, approx. 3.5/month
2018-2020 had 13 sold in 36 months approx. 1 in every 3 months
2021-April 2023 had only 3 sold in 26 months, approx. 1 in every 10 months
 
We went from about 53 of these distressed sellers per month to not even 2 per month (over 97% decrease). In fact, there hasn’t been a month with 20+ sold bank-owned properties in the last 5 years. On a similar note, approved short-sales hasn’t seen a double-digit month since Sept. 2013, almost 10 years ago.
 
That’s great news from an owner’s financial/credit history standpoint. They are not experiencing foreclosures or short-sales near as frequently; events which often dramatically hurt a person’s ability to get financing for anything in the future.
 
Now, this is not to say people have magically become more financially stable…it is to illustrate how much home values have appreciated. In recent years, when an owner can no longer afford and/or keep up with their mortgage payments, they know they can easily sell the property; at best, allowing them to realize the accrued equity created by the rising values or, at worst, they do not have to fear incurring a loss upon the sale. For the buyers that have been telling us, “We’re waiting to get a good deal on a house when the market crashes and a bunch of houses are foreclosed on.”, their wait continues.
 
That wraps up stats for another month. If you have any questions or want to understand the market even better, reach out!