Little Rock, AR Real Estate Market Trends & Analysis [Updated 2020]

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The Little Rock real estate market has had a hard time maintaining the same pace as its national counterpart. Whereas median home values across the United States have increased for the better part of a decade, real estate in Little Rock has had to overcome a few more additional obstacles. Due largely, in part, to an economy that still has plenty of ground to make up from the last recession, Little Rock real estate trends are on the right path, but not exactly where many people would have liked to have seen them at this point in the year. Nonetheless, things appear to be heading in the right direction. Things are looking up for the whole Little Rock housing market, and there may be no better time to consider investing in Little Rock, Arkansas than right now.

Little Rock Real Estate Market 2020 Overview

  • Median Home Value: $141,500

  • 1-Year Appreciation Rate: +1.4%

  • Median Home Value (1-Year Forecast): +0.8%

  • Average Days On Market: 76

  • Median Rent Price: $995

  • Price-To-Rent Ratio: 11.85

  • Unemployment Rate: 3.1% (latest estimate by the Bureau Of Labor Statistics)

  • Population: 197,881 (latest estimate by the U.S. Census Bureau)

  • Median Household Income: $49,957 (latest estimate by the U.S. Census Bureau)

  • Percentage Of Vacant Homes: 11.77

  • Foreclosure Rate: 1 in every 1,462 (6.8%)

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Little Rock real estate investing

2020 Little Rock Real Estate Investing

The Little Rock real estate investing community, not unlike investors across the country, places an emphasis on the acquisition of distressed homes. Motivated sellers are often the best source of deals with attractive profit margins. That said, there’s one type of distressed property investors should pay special considerations to: auction homes. If for nothing else, auction homes make up the largest pool of distressed properties in the Little Rock real estate market. Therefore, those who are interested in the Little Rock real estate investing industry should try to locate the closest auction; that is, if they hope to tip the scales in their favor.

Of the distressed homes identified by RealtyTrac, 64.0% are expected to be placed up for auction. Therefore, Investors should look into local auctions to increase their odds of finding attractive deals. Outside of auctions, however, investors may also want to look at bank-owned homes. Repossessed assets currently owned by their loan originators represent a great opportunity, and currently make up about 36.0% of the city’s distressed inventory.

Of course, knowing where to find real estate deals is only part of the equation. Once investors secure deals, they need to know what to do with them, which begs the question: Which exit strategies are working the best for local real estate investors? The answer is simple: all of them. However, short-term strategies appear to be more promising than their long-term counterparts at the moment. Rental properties remain a viable option for real estate investors to consider, but rehabs are currently more conducive to success when placed in context with today’s economic indicators. The city’s affordability has increased buying demand.

2020 Foreclosure Statistics In Little Rock

The low cost of living associated with the Little Rock real estate market has mitigated the foreclosure risk for most homeowners. That’s not to say the city is completely void of distressed homes, but rather that the distribution of foreclosures is relatively low. According to RealtyTrac, Little Rock is home to somewhere in the neighborhood of 124 foreclosures; that’s approximately one in every 3,895 homes, or a rate of 2.5%. While relatively low, there appears to be plenty of opportunities for local entrepreneurs to strongly consider entering into the Little Rock real estate investing industry.

Foreclosures have declined year-over-year. Despite a slight uptick from August to September, the number of properties that received a foreclosure filing was 36% lower than the same time last year.

While Little Rock real estate trends have drastically reduced the number of foreclosures across the city, real estate investors will be happy to hear that there are still isolated pockets of distressed assets. While the economy has made gradual improvements for years, some counties inherently boast more distressed properties than others, which begs the question: What is the best real estate market in Little Rock? The following counties have the highest distributions of foreclosures, and should be considered by investors:

Foreclosures in Little Rock

Data provided by RealtyTrac

2020 Median Home Prices In Little Rock

Is now a good time to buy real estate in Little Rock? The median home value in the Little Rock real estate market is $141,500, according to Zillow’s Home Value Index. Despite being higher than pre-recession levels, however, median home values in Little Rock are considerably lower than the national average. At $231,000, the median home value in the United States is approximately $89,500 more than the median home value in Little Rock.

The disparity in price becomes more apparent over the course of the last decade. Real estate in Little Rock has appreciated at a modest rate of 15.9% since the market bottomed out in January 2012. Over the same period of time, the median home value in the United States appreciated at a rate of 55.0%. In the last year (alone), median home values across the United States increased nearly three times more than in Little Rock—4.8% and 1.4%, respectively. Not surprisingly, the trend looks like it’ll continue into next year, as the Arkansas city appears unable to keep up the pace set by national trends. Real estate in Little Rock is expected to appreciate over the next 12 months, albeit at a more modest pace than the rest of the country.

Select neighborhoods across the city have contributed more to Little Rock’s appreciation rates than others, however. For two decades, these are the Little Rock neighborhoods that have appreciated the most (according to NeighborhoodScout):

  • City Center

  • E 9th St / College St

  • Pulaski / Pulaski Heights

  • U of Arkansas for Medical Sciences / W Markham St

  • Ampersand St / N Pierce St

  • E Roosevelt Rd / Bond Ave

  • Lee Ave / N Van Buren St

  • Hot Springs Junction

  • Philander Smith College / W 16th St

  • S Battery St / W Roosevelt Rd

Little Rock real estate trends haven’t been able to keep up with the rest fo the country, but that’s not necessarily a bad thing for local investors. In fact, while many cities across the country have priced prospective buyers out of the market, the city remains incredibly affordable. The city’s low cost of living should actually stimulate more housing activity, which bodes well for local investors.

Median home prices Little Rock

Data provided by Zillow

The Little Rock housing market has turned a corner. After years of trailing the national economy, things are starting to get better. While there is still plenty of ground to make up, however, the latest progress has helped the local real estate market. Improving economic conditions, in association with incredibly affordable housing options, have worked together to stimulate the Little Rock real estate market. As a result, everyone is expected to benefit: buyers, sellers and investors.

Little Rock Real Estate Market:2016 Summary

  • Current Median Home Price: $140,700

  • 1-Year Appreciation Rate: 0.8%

  • 3-Year Appreciation Rate: -2.4%

  • Unemployment Rate: 3.7%

  • 1-Year Job Growth Rate: 2.3%

  • Population: 197,357

  • Median Household Income: $46,409

Little Rock Real Estate Investing 2016

The first-half of 2016 witnessed very little traction in terms of home prices and appreciation rates, as prices for the city underwhelmed in comparison to the national average. Nonetheless, home prices in the second quarter continued to grow relative to the previous year. The Little Rock housing market also saw improvements in home affordability during the first-half. The capital of Arkansas was among the most affordable areas in the country, benefitting a trifecta of renters, homeowners and investors alike.

Despite lagging home prices and meager appreciation gains, the Little Rock real estate market pushed forward. The median home price grew to $140,700 during the second quarter, compared to the national average of $239,167. Although minimal, one-year appreciation rates crossed into positive territory, rising to 0.8% in Q2. Thankfully, the Little Rock real estate market had other factors working in its favor.

One component responsible for enhancing local real estate was the economy. Employment held up, while unemployment was better than the national average. The second quarter saw an unemployment rate of 3.9%, compared to the rest of the rest at 4.9%. Furthermore, one-year job growth reached 2.3%, wheres as the national average saw new jobs grow at a rate of 1.9%. In comparison to other markets, local employment growth was strong.

Little Rock Real Estate Market:2015 Summary

  • Median Home Price: $131,800

  • 1-Year Appreciation Rate: 6%

  • Unemployment Rate: 5.1%

  • 1-Year Job Growth Rate: 0.9%

  • Population: 197,357

  • Median Household Income: $48,304

Little Rock Real Estate Investing 2015

Little Rock real estate news was positive over the course of 2015. The real estate market became the beneficiary of several progressive indicators: increased equity, high affordability, well-developed infrastructures, low business costs and a high per-capita income rate. Due largely, in part, to these factors, the city’s recovery accelerated over previous years.

The median home price for the Little Rock real estate market was $131,800 in 2015. The national average, on the other hand, was around $203,867. With such a large difference in home values, it may surprise some to find out that appreciation rates across the country were very similar, 6.0% and 6.7% respectively. In fact, both saw encouraging rises in home prices at the time.

The influx of equity into the Little Rock housing market, while integral to the city’s growth, wasn’t the only positive indicator for the area. In fact, Little Rock real estate was very affordable in the face of rising prices. The city found a sweet spot between affordability and growing home values. Real estate investors grew to love the prospects of their careers.

On average, homeowners across the U.S. spent 14.4% of their income on monthly mortgage obligations in 2015. However, residents spent considerably less on housing, 6.3% to be exact. Affordability in the Little Rock housing market was higher than most markets across the country.

Many believe that the city avoided the most volatile parts of the recession because of its business infrastructure. Experts attributed the strength of the city’s nationally recognized economy to a number of diverse businesses. Low business costs brought in several large companies, which in turn generated a high per-capita income—at least compared to the rest of Arkansas.

Little Rock real estate investing is benefiting from a healthy economy, just like individual homeowners. However, investors were attracted to an entirely different part of the Little Rock housing market: distressed properties. At the time, there were about 200 homes in some state of foreclosure: default, bank-owned or foreclosure.

Of course, the availability of distressed properties was one thing, but the discount they offered was another. Distressed properties in the area sold for about $87,000 less than non-distressed ones. That was a savings of 56.2% per home.

Not only did the city avoid the recession for the most part, but it also improved its economic standing in the wake of it. A strong business infrastructure, in association with high per capita incomes and affordability, made the Little Rock housing market a very attractive area for both investors and homeowners.

Little Rock County Map:

Map of Little Rock housing market

Have you thought about investing in the Little Rock real estate market? If so, what are you waiting for? We would love to know your thoughts on real estate in Little Rock in the comments below.

*The information contained herein was pulled from third party sites. Although this information was found from sources believed to be reliable, FortuneBuilders Inc. makes no representations, warranties, or guarantees, either expressed or implied, as to whether the information presented is accurate, reliable, or current. Any reliance on this information is at your own risk. All information presented should be independently verified. FortuneBuilders Inc. assumes no liability for any damages whatsoever, including any direct, indirect, punitive, exemplary, incidental, special, or consequential damages arising out of or in any way connected with your use of the information presented.
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