After selling their condo in Spring of 2020, Little Rock resident Elizabeth Michael and her husband started looking for a place in Hot Springs, both to rent out as an Airbnb and use as a weekend getaway. It was around November before they were even able to get an appointment to see one that met their criteria.
"We would call a Realtor and say we want to see XYZ property and by the time we got 20 minutes down the road from Little Rock, they'd call and tell us it was already under contract," she said.
Michael said she was "deflated" by the market and the pace at which properties were selling.
"I was shocked, literally shocked. I've never encountered something where you want to spend money so badly and you can't. Normally they make it really easy," she said.
Michael's experience reflects a larger pattern. Hot Springs Board of Realtors data sent by President Rob Pfautz shows the average number of Days on the Market for Garland County homes went from 98 in 2019 and 96 in 2020 to 82 in 2021 through April 30. However, Pfautz said some overpriced inventory can skew the average higher. He said the median is 55, so the majority of sales are closing under 60 days.
Pfautz said there are more buyers than sellers in the market, and anyone interested in buying needs to be proactive.
"The chances are, when a home comes on the market, you need to be preapproved. You need to have a Realtor that's really ready and can be assertive and get you in these homes," he said. "We're typically getting multiple offers within a day or two of homes hitting the market. So it's very competitive, and so as a buyer you be patient, try to find that right home. We're seeing homes go over list price."
However, for those looking to sell, Pfautz said now is the time.
"If you're looking at selling, this is the best market I've seen in years. You're selling quickly, you're getting a premium price for it, and it's a great market for sellers. Harder for buyers, great for sellers."
Pfautz said the market has been steady and rising for the past few years, but slowed down when everything shut down in mid-March of 2020.
"What happened, by about mid-April after about a month, there were still buyers who were like 'Hey, I need to buy real estate.' The interest rates were good. So they were still going out, and by the time the summer came, it just popped. It was quite a demand for homes, especially around the lake and this area, and it hasn't slowed down since," he said.
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The Hot Springs Board of Realtors data also shows the average sales price for properties in Garland County has been rising recently. For instance, the average sales price for a Residential Single Family property was $174,788 in 2019, going up to $197,088 in 2020. For 2021 through April 30, it went up to $209,667. During that same time period during 2020, it was $173,437.
The data is per the Board of Realtors Multiple Listing Services. Pfautz noted that, while not all properties bought and sold in the county go through the Multiple Listing Services, the numbers reflect an accurate picture of the market in the county.
Real estate investor Tim Fisk was looking for a new property to rent or use during the pandemic as well, and he said he saw the market getting hotter and hotter.
"We had made an offer on a condo at one point and it was probably way more than we initially intended to spend but that's what the market was doing," he said. "You know what I mean, if you wanted to capture something you had to go 'Well, I'm going to spend a little more than what I initially thought,' because that's how hot the market is right now."
Fisk said he had it under contract, had agreed on a price, and was negotiating smaller details, when he said the seller received several more offers over asking price during a 24-hour time period. He said the seller withdrew her acceptance and walked away from the deal. Fisk was "flabbergasted."
"Never in my life have I had somebody walk away during that period," he said.
Fisk said he's been buying and selling properties for around 20 years. In all those years, he said he's never had to use an escalation clause, something he employed in order to get a property in the current market.
Click here to see local real estate statistics: https://www.hotsr.com/documents/2021/may/31/real-estate-statistics/
"We had a contingency, or a phrase or clause in our offer that said we were willing to go higher up to X amount, so as a person would come in above us, our escalation clause jumped over them. And then the next person came in and our escalation clause jumped over them," he said. "It's something I didn't know about before. My friend from California told me about it, but it never registered to me because, like, that's never going to happen here. I mean here, it's five dollars a square foot more will get you the deal. That's not the case in this market right now."
Though he was eventually able to get a property in the area, Fisk described the process as a "roller coaster," falling in love with properties and becoming invested, but then being beaten out or having a property come under contract before the Realtor could set up a showing, saying that at one point he had "kind of given up."
Michael also ended up finding a property in Hot Springs, closing early in 2021, though she said the process caused plenty of sleepless nights.
"If I was in a position where this wasn't a second property and an investment property, if this was my primary home and I really needed to move, I can't imagine the stress that it would put you under," she said.
Pfautz said anyone who is looking to buy needs to be ready.
"My recommendation is be fully prepared if you're wanting to buy, either you got the cash to buy or you go to a good lender that can pre-qualify you because when you're in a competitive situation looking for a home, when one hits the market, you have to be ready, and you have to have your ducks in a row and you need to be able to make a good offer and be qualified to do so," he said.