WASHINGTON (5/12/15)--Home prices in the majority of metro areas nationwide climbed in the first quarter thanks to a pickup in demand and weak inventory growth, the National Association of Realtors (NAR) reported Monday.

Median existing single-family home prices rose in 85% of the 174 measured markets during the quarter. Additionally, the number of metros that saw double-digit price growth doubled from the prior quarter, according to NAR.

“Sales activity to start the year was notably higher than a year ago, as steady hiring and low interest rates encouraged more buyers to enter the market,” said Lawrence Yun, NAR chief economist. “However, stronger demand without increasing supply led to faster price growth in many markets.”

The national median existing single-family home price in the first quarter came in at $205,200, a 7.4% increase from the first quarter in 2014.

Further, existing-home sales fell 1.8% to a seasonally adjusted annual rate of 4.97 million during the first quarter from 5.06 million in the final quarter of 2014.

Supply also has remained relatively flat on an annual basis, with 2 million existing homes for sale at the end of 1Q, up from 1.96 in the first quarter of last year.  

“Sales could soften slightly in some of these markets seeing sharp price appreciation unless housing supply markedly improves and tempers its unhealthy level of growth,” Yun said.