The median price of a home in the city rose 2.2 percent in the first quarter of 2009, compared with the same period a year ago, the Santa Fe Association of Realtors reported Tuesday.

The not-so-good news for sellers and real-estate agents is that in the same three months, the number of homes sold in the city dropped to 95 from 138, a 31 percent decline.

"We are beginning to see a very modest increase in home values compared to last year during the same period for city homes and condos," association president Mary Schroeder said. "But sales remained slow."

The better news for the industry is that while home sales in Santa Fe "really struggled in January and February," Schroeder said, "March was looking much better. Prices were up 12 percent in March. And we're also finding that April is looking much the same way. We appear to be gaining recently."

The $308,000 median price for this year's first quarter remains well below the peak reached in the fourth quarter of 2005, when it spiked to $470,000.

Schroeder, along with other Santa Fe Association of Realtors officials — real-estate agent Lois Sury, appraiser Don Hall, commercial real-estate agent John Shepler and loan officer Leroy Baca — discussed sales, appraisals and mortgage lending in a meeting at the group's offices on North Guadalupe Street.

The association cautions that the median sales price is based on sales listed through the Multiple Listing Service, which does not necessarily include every sale in the area but historically has been used to track trends in the market.

In Santa Fe County, the number of homes sold dropped 20 percent, to 82 from 103, while the median sales price fell 8 percent, to $440,000 from $480,000.

In the county, Schroeder said, "sales and values appear to be stabilizing with sales off a smaller percentage and values by only 8 percent."

While the number of home sales dipped in Eldorado — from 21 to 16 — the median sales price rose to $375,000 from $349,000, an increase of 7 percent.

On a negative note, both Santa Fe city and county land sales dropped to a total of 21 lots in the first quarter of 2009, compared with 49 in the first three months of 2008.

Condo and townhouse sales also were quite weak, falling from 61 to 27 in the city and county in the same time period.

The reason for the decline in land sales, Baca said, is that under current conditions, with a glut of homes on the market, "it's cheaper to buy an existing home." In addition, "people are expecting to see values on lots drop" as the recession lingers.

Another sign of the real-estate market's strength in the first three months of 2009 compared with the same period in 2008 was reflected in the percentage of the asking price that homes sold for.

In January and February, the selling price was only 80 percent of the asking price. In March, however, the selling price rebounded to 89 percent of the asking price.

"This gives me hope," Schroeder said.

Hall agreed, explaining that sellers are finally beginning to realize their homes are not necessarily worth today what they were a few years ago. "It's finally dawning on people they have to be realistic," he said.

Schroeder said she expects the second and third quarters to be stronger than the first and last quarters, as they traditionally have been.

Baca said interest rates are very low — in fact they haven't been this low in 50 years. A 30-year, fixed-rate mortgage is available for as low as 4.625 percent.

"I would have to say that this is the lowest possible time for interest rates," Shepler added.

First-time buyers should be aware that there are several down-payment assistance programs, such as Mortgage Booster and Payment Saver, that make it easier for them to find a home, Baca said.

Despite these favorable developments, Baca said, one of Santa Fe real estate's historic components, sales to second-home buyers, is "just not happening right now."

That's partly because of the fact that some of Santa Fe's feeder markets have slowed dramatically.

As for commercial real estate, Shepler said he has noticed a "nice uptick" in activity on the commercial front. "Confidence has returned to the marketplace."

Contact Bob Quick at 986-3011 or bobquick@sfnewmexican.com.