Figures released today by the Capital Area Association of REALTORS® (CAAR) Multiple Information Service (MIS) revealed that 1,077 existing single-family home sales were recorded during the third quarter of 2003, yielding a remarkable 24.8 percent increase from the 863 units sold during the same period in 2002.

CAAR President Rick Hanselman said that these record numbers underscore the powerful fundamentals that are driving the housing market –– household growth, low interest rates and an improving economy. The three-month surge indicates the top of the housing market's historic run according to Hanselman. "Some of the home sales closed in August and September were negotiated in June when mortgage interest rates hit record lows," he said. "Much of the remaining portion of sales reflect quick decisions to make offers in July when interest rates began to rise sharply. The good news is that mortgage interest rates have declined since that time."

The Capital area median existing single-family home sale price for the third quarter of 2003 was $92,800, nearly 2.0 percent above the previous year's third quarter median price of $91,000. The median is the midpoint in the price range; half the homes sold cost more, half cost less. Total dollar volume of allsingle-family homes sold during the third quarter of 2003 was $120.3 million revealing an increase of 29.5 percent from the $92.6 million sold during the same period of last year.

Third quarter 2003 sales of all property classes combined (i.e., commercial, industrial, farm, residential, vacant land) reveal sales of 1,169, reflecting an increase of 21.6 percent from the 961 sales reported during the same period of 2002. Total dollar volume of all real estate sold during the third quarter of 2002 was $129.7 million revealing an increase of 31.3 percent from the $98.8 million sold during the same period last year.

Hanselman said the swing in mortgage interest rates has been somewhat of a surprise this year. "Mortgage interest rates have been lower than projected for most of 2003, but the 30-year fixed rate should hover between 6.0 and 6.5 percent for the rest of the year," he said. "We expect home sales to moderate but remain historically strong in the coming months."

Hanselman said the timing of low interest rates coincides with strong housing demand by young households. "Echo boomers –– the children of the baby boom generation –– are entering the age for buying a first home," he said. "In fact, four out of 10 buyers are purchasing their first home, which is providing liquidity to sellers that in turn fuel other sectors of the market."

The Federal Home Loan Mortgage Corp. reported that the national average commitment rate for 30-year, conventional, fixed-rate mortgages was 6.0 percent during the third quarter of 2003, down from the 6.3 percent rate for the same period of 2002.

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.