Fayetteville Arkansas, University of Arkansas--Old Main Overview

Fayetteville Arkansas, University of Arkansas--Old Main Overview
Overview of Fayetteville, AR

Monday, April 30, 2007

First Quarter 2007 NW Arkansas Housing Market Update

According to the National Association of Realtors®, the GDP (Gross Domestic Product—or total value of goods and services produced in the US) grew at a slower than expected 1.3% in the first quarter of 2007, due in part to the housing slump across the nation.

On April 25 the National Association of Realtors® announced that sales of existing homes plunged 8.4% in March, the worst one-month decline in 18 years. The median price of an existing home nationally fell to $217,000, a 0.3% decline from March 2006. Inventories of unsold homes nationally rose to a 7.3-month supply, the highest level since October. New home sales in March rose 2.6% over February, but were down 23% from March 2006, the second weakest year-over-year sales performance since September 2001, according to an April 25 report from the Census Burea. Surprisingly, the median price nationally of a new home sold in March was $254,000, up 6.3% from the price of a new home sold a year earlier.

Home sales in NW Arkansas, as elsewhere, were down in the first quarter of 2007 compared to the last quarter of 2006. This is a normal seasonal occurrence, since the NW Arkansas housing market is largely weather driven, and we had awful, cold weather. But homes are now taking longer to sell due to elevated inventory in almost all price levels, with the average days on market (DOM) up in all of the NW Arkansas towns. The “buyer’s market” discussed in media reports does exist here, and with high inventory and falling prices, it might be a good time for buyers to purchase a home in NW Arkansas. Nevertheless, each town does have slightly different market trends.

An exception to what I have said above, Fayetteville actually experienced an increase in home sales in Q1 2007 with 258 homes sold (86 per month), compared to 248 homes sold in the Q4 of 2006 and the same number sold in the Q1 of 2006. As for prices, after a drop of almost 14 percent in the last quarter of 2006, the average price of homes sold in the first quarter of 2007 increased by almost 6% to $216,013. The median price of homes sold was $189,900, and the DOM was 137, up from 110 in the 4th quarter of 2006. The highest average sales price in the past couple of years was $236,616 in the 3rd quarter of 2005.

Springdale’s housing market is down from both the past quarter and from the same quarter last year. There were 275 homes sold in Q1 of 2007 compared to 283 in Q4 of 2006 and 313 in Q1 of 2006. Average DOM has increased to 132 over the past year from 111 in Q1 of 2006. The average and median sales prices have also decreased over the past year. Average sales price is down almost 8% compared to Q1 last year and almost 3% from the last quarter. The average sales price for Springdale during Q1 of 2007 was $160,882 after a peak in Q2 of 2006 of $181,380. The median price of homes in Springdale in Q1 of 2007 was $149,900—a decrease to the same level as in Q4 for 2005. It should be mentioned, however, that not only does the decreased average and median sale price reflect lower prices for homes, but also the increased availability of less expensive homes. This might be a good time to invest in a home in Springdale.

Bentonville is still the most expensive place to purchase a home in NW Arkansas, with an average sale price of $235,229 during Q1 of 2007, compared to $212,666 in Q1 of 2006. However, prices have dropped slightly from the highest average sale price in the past couple of years, which occurred in Q4 of 2006 at $238,659. However, the median sale price is now the highest it has been at $209,000, compared to $194,500 in Q4 of 2006 and $180,000 in Q1 of 2006. The median price represents the middle price of all homes sold, with equal numbers of more expensive and less expensive homes sold. This increase represents a 16% increase compared to Q1 of 2006 and almost an 8% increase from the last quarter of 2006.

Average days on market (DOM) in Bentonville has reached 162, up from 142 in Q4 of 2006 and 124 in Q1 of 2006. And the number of homes sold in Bentonville during Q1 of 2007 has decreased significantly to 151, compared to 192 in the same quarter last year and 197 in Q4 of 2006. The highest number of homes sold in the past couple of years in Bentonville occurred during Q3 of 2005, 292 homes.

The picture in Rogers is slightly different from that of Bentonville. It is the same in that fewer homes were sold in Q1 of 2007 compared to Q4 of 2006 (279 compared to 319), but when compared to Q1 of 2006 (275 homes sold), more homes were sold. Also both median and average prices have declined. The average sale price in Q1 of 2007 was $193,807 and the median sale price was $160,000. This represents a drop of 14% compared to Q4 of 2006 and 13% compared to Q1 of last year in average sale prices, and a drop of over 7% in median sale prices compared to Q1 and Q4 of 2006. As in Springdale, this signifies both falling home prices and the increased availability of less expensive homes. The DOM is up to 167 days, compared with 147 in Q4 of 2006 and 122 in Q1 a year ago.

Bella Vista’s market, in some respects, has remained somewhat steady in comparison to the other towns of NW Arkansas. This could be because the price ranges of homes are more limited. Nevertheless, there was also a decline in the number of homes sold in Q1 of 2007 compared to the previous quarter, from 243 to 200. The number of homes sold in Q1 of 2006 was 265. As in the other NW Arkansas towns, average DOM increased from 135 to 145, the highest it has been in the past couple of years.

But prices haven’t changed that much in Bella Vista. The average sales price did decline slightly from $178,789 in Q4 of 2006 to $176,201 in Q1 of 2007 (only 1.51%). The median price increased slightly in the same period from $155,000 to $159,000 (only 2.58%).

All in all, many of the changes are normal seasonal ones and follow similar patterns to previous years. As mentioned earlier, the weather does have a significant effect on the NW Arkansas housing market, and this winter has been extremely cold. Another factor has been the large amount of media type about the “housing slump” which made many buyers afraid to purchase; they didn’t want to pay too much if prices were going down.

Until the past couple of quarters, NW Arkansas seemed immune to these national trends with home prices rising even as they were bottoming out in other parts of the country, but an adjustment has finally occurred.

Yes, prices have come down, so this might be a good time to buy, since the supply of homes is up and interest rates are still down. It is definitely a buyer’s market in almost all price ranges. And now that the weather is improving, I have noticed a decided increase in buyer activity.

Note: Data for local statistics in this report is from the NW Arkansas MLS and included only homes that were listed by real estate agent members of the MLS. It does not include For Sale by Owners or other properties not listed by a real estate firm. For comparison purposes the national median home price in Q4 of 2006 was $219,300. NW Arkansas is still a “good deal.”

These figures do vary according to price range, city, and neighborhood. If you would like more information on your specific neighborhood, email me at judy@judyluna.com.

For more information on other economic indicators for Q1 2007:


Monday, April 23, 2007

Reflections on the Life of Helen Walton

Helen Robson Walton, widow of Wal-Mart founder Sam Walton, died last week. Her passing signifies the end of an era, but her influence will live on.

Lady, Christian, philanthropist, savvy businesswoman, unpretentious, caring humanitarian – these are but a few of the adjectives used to describe Helen Walton. She was a loving wife and mother to Sam and their four children and “the woman behind the successful man.” One might wonder if (in a different generation) she might not have been the founder of Wal-Mart.

Helen Walton was a woman’s libber before that term was even coined. She earned a bachelor’s degree in finance at the University of Oklahoma in 1942, back when such a pursuit was unusual for a woman.

She pushed to have women on Wal-Mart’s board of directors and in 1986 the first woman, Hillary Clinton, joined the board. Helen also understood early on, the long-term importance of providing profit sharing to Wal-Mart employees, to which Sam agreed.

Always active in the Presbyterian Church, Helen was the first female vice-chair and first female chair of the board of trustees for the Presbyterian Church (U.S.A.) Foundation. She also was active on the board of the University of the Ozarks in Clarksville, Arkansas, and was its honorary lifetime chairwoman.

Helen Walton personally supervised the $3.6 million scholarship fund for Central American students at John Brown University, University of the Ozarks, and Harding University. According to Wal-Mart, about 1,000 students have participated in this program since 1985. Most, if not all, the students have returned or will return to their home countries after graduating with the intent of improving the lives of their fellow citizens.

She was the person behind the Wal-Mart Foundation, which has given untold millions of dollars to the community. One example is a $300 million donation to the University of Arkansas. The foundation had earlier given $50 million to the university's school of business, which was subsequently renamed the Sam M. Walton School of Business.

Other notable contributions include $39.5 million to the University of the Ozarks, the largest gift to a private institution in Arkansas.

Always interested in education and the arts, Helen Walton was a founding member, organizer and 1992 president of the Arkansas Committee of the National Museum of Women in the Arts in Washington, DC.

She was the leading supporter of The Walton Arts Center in Fayetteville.

She also was the impetus behind a plan to include computer technology in all Bentonville-area school districts. That project resulted in a computer in each classroom and a computer lab in each building.

Sam started a small business in a very small town, Bentonville, Arkansas. His wife and partner, Helen, was his bedrock all the way. She provided not only heart and business acumen, she was the source of many of the humanitarian practices established in the corporate structure as the company grew.

These days Wal-Mart bashing is a popular activity. A strong anti-Wal-Mart movement exists but it wasn’t always that way. Many people in NW Arkansas, throughout the country, and even other parts of the world will remember Helen Walton and her husband, Sam, for the many trails they blazed.

For more information:


Sunday, April 22, 2007

Fayetteville’s Impact Fee Election Results Somewhat Uncertain

When I posted my blog entry April 1 about the upcoming special election on impact fees, I fully expected to post a follow up the day after the April 10 election to state the results. Well, as some of you already know, results are somewhat murky.

The morning after the election the unofficial count was tight, to say the least. Supporters of the fees had a one-vote lead. (Once again, I say, “Don’t ever think your one vote doesn’t matter.)

The major holdup at that point was 15 outstanding absentee ballots. The ballots would be counted if they were received by April 20, the day the election was to be certified.

When the absentee ballots were added to the earlier results, the election was a tie, 2015 votes for and 2015 votes against. Elections have to be won by a majority so the tie means the impact fee increase failed.

As if an election that close isn’t interesting in itself, here’s the really unusual part.

One of the absentee ballots may ultimately be thrown out on technicalities. It seems the overseas voter did not use the same exact address on the application for the ballot as he did on the statement accompanying the ballot.

That particular ballot was a No vote. It was the vote that created the tie. It was included in the final certification.

If that ballot is challenged and subsequently removed from the official count, the election will have been approved by one vote.

Washington County Attorney George Butler is researching the situation but said he expects to find little precedent to resolve the matter.

Because the law is generally against disenfranchising voters, Butler encouraged the Washington County Election Commission to count the ballot in question. Butler stated further that the commission may file an amended certification reversing the election if that becomes necessary.

For more information:


Tuesday, April 17, 2007

General Aviation Airports are Big Business in NW Arkansas

NW Arkansas is lucky to have several excellent general aviation airports. The airports contribute to the economy by providing jobs, paying taxes, and serving many of the businesses located here. They serve not only the owner of a 2-seat propeller airplane but businesses of all sizes.

In fact, Rogers’ and Fayetteville’s general aviation airports are two of the most successful in the state, according to a recent study commissioned by the Arkansas Department of Aeronautics. Their combined annual economic impact is estimated at $128 million including direct factors such as fuel sales and the trickle-down effect of indirect factors such as wages paid to employees who then spend that income locally.

Rogers Municipal Airport at Carter Field is home to Wal-Mart’s corporate fleet, a fact that certainly helps explain why that airport is the most lucrative general aviation airport in the state. (According to information I was given at the Wal-Mart Museum in Bentonville, Wal-Mart ‘s fleet consists of 21-22 jets.)

Fayetteville Municipal Airport, Drake Field, is home to the University of Arkansas at Fayetteville’s jets. Drake Field’s revenue was ranked fourth in the state, generating $34 million, the ADA study found. It’s commonplace there to have people fly in for Razorback games.

In addition to Rogers and Fayetteville, Springdale and Siloam Springs have general aviation airports with thriving charter service. Springdale’s airport includes a complete aircraft maintenance facility and a 300-foot runway expansion is under consideration.

General aviation airports offer expediency and cost savings to corporations both large and small. It’s easy to understand how Wal-Mart would save money by flying several executives to another city and back in the same day.

But the airports also offer savings for smaller corporations in outlying areas such as Siloam Springs. That city is home to Allen Canning and Simmons Foods, corporations that also have the need to move people expeditiously to other facilities throughout the country. “Without these airports, small communities just aren’t as viable,” said Mark Anderson, Allen Canning’s chief pilot. “For us, people would lose a whole day driving. It’s about the utility and efficiency.”

Another major economic factor is the businesses such as support services, aviation industries and airfreight companies that locate on the periphery of airports.

Speed, convenience and privacy of charter jet service are also becoming increasingly attractive to individuals who can afford it. A 2004 survey conducted by the National Business Aviation Association found that two-thirds of charter operations had a significant portion of new business from travelers who had stopped flying on commercial carriers.

The Arkansas Department of Aeronautics recently reported that in the last 10 years the number of general aviation aircraft based in the state has risen from about 2,300 to 2,808. Between 2005 and 2025, the department estimates that the number of general aviation business jets will increase in number from 182 to 531, almost tripling in number in 20 years.

For more information:




Saturday, April 14, 2007

Fayetteville MSA Receives Another #1 Rating

Our best-kept secret has been announced to the world by Bert Sperling of Sperling’s Best Places fame. Sperling has previously researched and written books about a variety of issues such as the best places to raise a family and cities with the lowest crime rates.

This time Sperling looked at quality of life, affordable housing, high percentage of home ownership, low unemployment and fast rate of job growth. He discovered the Fayetteville Metropolitan Statistical Area (MSA) and ranked it number one in the country. (Fayetteville MSA includes Fayetteville, Springdale, Rogers, Bentonville and stretches into extreme southwest Missouri.)

The area boasts five-year-job growth of 26.1% and a low unemployment rate of 3.5%. In addition to the headquarters for Wal-Mart, Tyson and J.B. Hunt Trucking, many other Fortune 500 companies have offices here.

Living costs are low. According to the book, the median home price in the Fayetteville-Springdale-Rogers area averages $212,300 for a 3-4 bedroom home with approximately 2,000 sq. ft. of living area.

We have the University of Arkansas-Fayetteville with all their sports and cultural activities, several museums plus a world-class museum scheduled to open in 2009, a large performing arts center, excellent medical facilities, and our own regional airport with non-stop service to Chicago, Houston, Detroit, Minneapolis and additional cities.

Add all that to the clean air and natural beauty of the Ozarks, many lakes including Beaver Lake with its 449 miles of shoreline, and a very livable four-season climate and you can easily understand why Sperling found this area so attractive.

For the past several years, some 1000-1100 people have been moving here each month. I guess Bert Sperling isn’t the only person to recognize a good thing when he sees it.

For more information:


Sunday, April 08, 2007

Affordable Housing May Still be Possible in NW Arkansas

Good news! Builders and cities are beginning to realize that the majority of people cannot afford a mansion to house their families.

I have maintained for considerable time now that there is a shortage of affordable homes. Land prices have increased dramatically while wages have not kept pace.

When builders have to pay more for land they generally build a more expensive home in order to recoup the cost. Fancy bathrooms, gigantic master bedrooms, granite counter tops, top-of-the-line appliances, and 3-car garages are all very nice – but not affordable for the average wage earner.

Three bedrooms, 2 baths, ceramic tile in the wet areas, and 1,000–1,200 square feet are perfectly serviceable homes for many people. These “starter homes” are more important now than ever before.

When homebuyers are forced farther away from the major municipalities to find a home on lower cost land, their cost of commuting to work increases. At the same time, infrastructure is strained and traffic congestion increases.

Now, I’m happy to say, some builders and cities are cooperating in an effort to create affordable housing. Homes can be built with smaller set backs and less space between homes.

One builder is planning to build 1,000 square foot homes in Rogers with an expected sales price of about $110,000.

Building on empty land where the infrastructure is already in place is another way to lower the overall cost of the home. This is called “in-filling” and helps reduce urban sprawl.

Each year NW Arkansas homebuilders showcase their homes in the Parade of Homes. The parade has traditionally featured homes for the more affluent buyer. This year, some builders may highlight less affordable homes, a trend I hope will continue.

The Parade of Homes is open to the public and will take place the weekend of June 22-24.

For more information:



Sunday, April 01, 2007

Impact Fees – How Much is Too Much?

Less than one year ago Fayetteville voters approved a ¼ of 1% sales tax increase to pay for $65.9 million in bonds for street improvement projects.

Now Fayetteville residents are being asked to vote at a special election April 10th on the question of whether to impose an impact fee on builders to provide additional funds to improve roads.

If the impact fee passes, the additional amounts charged builders will vary from $2,363 for a single family detached home, to $1,319 per room for a hotel/motel, and on up to $2,701 per 1,000 square feet of commercial or office space.

As usual, there is more than one point of view when looking at this problem.

Does it make sense that the builder should be charged for the infrastructure that his project would necessitate? It’s easy to say “Yes, that sounds logical.” But look a little deeper into the problem and you’ll see it is the buyer or renter that will ultimately pay the fee. Homes will cost more and rents will rise.

I’ve written previously about the lack of affordable housing in NW Arkansas as a whole and Fayetteville in particular. Adding another $2,363 to the cost of each home only makes homes less affordable.

Another issue is whether increasing the impact fees already in effect will deter businesses from locating in Fayetteville. That issue, too, can be argued two ways. Some say that businesses seeking to expand or move to Fayetteville will look at other areas where fees are lower or nonexistent, and this has already happened.

If businesses locate elsewhere, Fayetteville’s sales tax receipts will decrease accordingly. Keep in mind that sales tax is a principal source of revenue for city capital improvement and schools. There has already been a decrease in sales tax revenues in the last quarter of 2006.

Others say look at Bentonville. The impact fee for a single home in that city is $4,750 and the city is growing at a major pace.

The new impact fee will make Fayetteville’s the highest in NW Arkansas at $4,897. Springdale has no impact fees and has completed major improvements on their artery streets, as well as neighborhood streets, by sales taxes voted by residents and by bond issues. Rogers charges a $2600 “sewer and water hook-up” fee, which some call a disguised impact fee and which has been challenged in court.

However, the bottom line here is that developers in Fayetteville already pay impact fees for new-construction, which are passed on to the consumers of these homes. Developers also are required to install (at their own expense) new roads and other infrastructure items, such as water lines, sewer lines, etc. An additional road impact fee will basically be another tax, not just on developers and builders of new areas but on everyone who lives in Fayetteville. It’s a case of double taxation, despite what those in favor of the measure say. And it puts the burden of street improvements for older areas of Fayetteville on the developers of new areas. Is that fair?

Ultimately, money for additional (and much needed) street improvements will have to come from somewhere. If taxes need to be increased, so be it—let the voters decide as they have in the past. But let’s be honest.

I have a great concern that Election Day is just around the corner, and I don’t believe the majority of voters have taken an interest in the matter at hand. I encourage everyone to become informed and vote his or her conscience. I personally am going to vote NO.

Here are some links for further information: