SPRINGFIELD (May 2, 2005) Existing-home sales continued its record-setting trend during the first quarter of this year along with strong home price gains, according to the Capital Area Association of REALTORS®.

Total existing-home sales – including single-family, townhomes, condominiums and co-ops – equalled 781 units during the first quarter of 2005. First quarter 2005 sales were the highest first quarter on record, and were 5.3 percent above the 742 unit pace during the first quarter of 2004. This represents the fourth consecutive year that first quarter home sales were at record levels.

Gail Chevalier Zini, CAAR’s president, said that we had expected the housing market to begin to settle down a bit during the first quarter. “To the contrary, home sales have continued to surge at unprecedented levels,” she said. “At some point during the year we expect a cooling-off period where we expect to transition from a red-hot housing market into a very strong market that is fairly balanced between buyers and sellers.” Chevalier Zini said that she doesn't expect it to cool off anytime soon since activity continues at a robust pace.

The median sale price of a home during the first quarter of 2005 was $90,500. This figure reflects a healthy increase of 9.0 percent from the 2004 median sale price of $83,000. Total home sales volume for the first quarter of 2005 reached $86.8 million which reflects a 14.6 percent increase from the previous year.

According to Freddie Mac, the national average commitment rate for a 30-year, conventional, fixed-rate mortgage was 5.76 percent during the first quarter of this year, up slightly over the 5.6 percent in the first quarter of 2004. “Aside from a handful of months over the last two years, you have to go back to the mid-1960s to see mortgage interest rates where they are today,” Chevalier Zini said.

Gail Chevalier Zini, CAAR’s president, said she expects home sales to start to ease to more sustainable levels. “After setting four consecutive record years, the housing market is due for a breather,” she said. “As mortgage interest rates creep up and home sales slow a bit, we should see a better balance between home buyers and sellers – that will take some of the pressure off of home prices.”

First quarter 2005 sales of all property classes combined (i.e., commercial, industrial, farm, residential, vacant land) reveal sales of 872 properties during the first quarter of 2005, up 1.5 percent over the 859 sales reported during the same period of 2004. Total dollar volume of all real estate sold increased 9.5 percent with $101.6 million sold during the first quarter of 2005 as compared to $92.8 million during the same period last year.

The Capital Area Association of REALTORS® is the Voice for Real Estate in the Capital Area representing more than 700 members involved in all aspects of the real estate industry. The Capital Area’s Resource for Real Estate Information can be found at www.SeeHouses.com.