TOP STORY >>Local area sees more residences going up
Leader staff writers
June is Homeownership Month, and the housing market in central Arkansas continues to boom despite predictions of a slump in housing nationwide. “I have been in this business for 19 years and my team has posted record sales for three consecutive months in a row. Currently, we are averaging a home sale every 19 hours in my office,” said Steve Blackwood, of The Blackwood Team realty. Blackwood credits the Cabot School District with the solid housing market in the area. The population of Cabot is projected to be about 20,000 soon, with an average 25 new home permits per month. In May, the city issued building permits for $3.6 million in construction, including 18 permits for homes over $100,000.
The housing market in Beebe has been described as “ready to boom” after years of near-dormancy. Jason Scheel, chairman of the city’s planning commission, said he is seeing more growth in housing now than he has seen in five years on the commission. Allen Ridings, the city’s code enforcement officer and building inspector, says he seen more construction recently than in eight years on the job.
Scheel attributes the five new subdivisions with about 200 homes either under construction or in the planning phases to the quality of life possible in Beebe. “We have a good school district and ASU-Beebe is right here,” Scheel said. “Most people work in or around Little Rock, but they know they can live here and have a good place to spend their afternoons and weekends.”
Most of the homes planned for Beebe are relatively small at 1,200 to 1,500 square feet and will sell for about $100,000 he said. The larger, high-dollar houses are outside the city where lots are measured in acres.
Scheel said Beebe simply doesn’t have enough land for developers to offer large lots. The city council’s attempt last year to grow through annexation failed, but the plan is to try again, he said. The draw of the Cabot School District, responsible for Cabot’s phenomenal growth, also benefits the housing market in Austin and Ward, which are part of the district.
Like Beebe, Austin also is on the verge of a building boom, but unlike Beebe which will have to annex for any large change in population, Austin could potentially grow from 604 in the last census to about 4,500 when the 1,500 homes in nine subdivisions either planned or under construction are sold.
Ward has about 10 subdivisions that are either filling up with new houses or in the preliminary phase where the streets are built. So far, this year about 100 building permits have been sold at city hall. Ward’s growth has been steady. The last census set its population at 2,500, but new subdivisions have already increased that number to almost 3,400 and with more houses being built all the time, the population is expected to reach 5,000 by 2010.
Mayor Art Brooke says houses in Ward sell for an average of $20,000 less than in Cabot. Neither does Ward have the traffic problems that Cabot has, which makes the city more desirable to some families, he says. While the housing market is expected to keep fading from its record levels, 2006 is still expected by many economists to be the third best year for housing ever. In Arkansas homeownership is at a near record high of 69 percent.
“With the soaring cost of new construction, we have seen an increasing demand for existing homes which are perceived to be a better value in comparison to many new construction homes,” Blackwood told The Leader. Little Rock Air Force Base’s economic impact on the local economy increased $20 million from $580 million in 2004 to $600 million in 2005, most of which comes from military members living in surrounding communities.
According to Little Rock Air Force Base’s 2005 fiscal year economic impact analysis released in April, the base’s 5,919 active duty personnel collect $274 million in pay, which is spent in surrounding cities of Sherwood, Jacksonville, Cabot and Beebe for rent and housing. Only 483 airmen live on base now as the older homes on base are being either demolished or renovated as part of a $500 million housing contract awarded to American Eagle Communities. By 2012, American Eagle Commits plans to renovate 732 existing homes and build 648 new homes to make living on the base more appealing to military families.
Analysts with the National Association of Realtors are expecting the 30-year fixed-rate mortgage to average 6.9 percent during the second half of the year and the unemployment rate is expected to average 4.8 percent in 2006. Buyers are currently committing to an average 6.67 percent interest on new, 30-year fixed-rate mortgages, compared with about 5.5 percent a year ago. That change raises the monthly cost $150 for a $200,000 mortgage.
The national median existing-home price for all housing types is forecast to rise 5.3 percent this year to $231,300. With more construction in 2006 taking place in lower cost housing markets, the median new-home price is projected to increase 0.8 percent to $242,900.