CHAPEL HILL -- The average price increase over last year for a home sold in Orange County was more than five times the increase in Durham and nearly 4.5 times the increase in Wake during the first quarter of 2005.

The average closing price in Orange was $309,325, up 18.4 percent from the 2004 average of $261,296, according to data obtained from Market Opportunity Research Enterprises, a Rocky Mount firm. Durham and Wake saw meager increases for the same period, 3.4 percent and 4.1 percent, respectively.

In Orange, homes up for resale appreciated in value more quickly than new homes on the market. Resale homes are commanding prices 21.5 percent higher than last year, with an average closing price of $288,006, up from $237,052. New homes are up only 14.9 percent from last year's level of $335,265 with a new average price of $385,276.

Increased prices, however, aren't deterring prospective buyers. The number of closings during the first quarter was up 10.3 percent from last year.

And they didn't deter Anne West.

"It wasn't a decision we struggled with," said West, who closed on a house at the end of May.

West, her husband, Bill Rinehart, and their 3-year-old son moved from Boston, Mass., to a home in the Carrboro's Lake Hogan Farms neighborhood. Both husband and wife are neurobiology researchers at Duke University.

Rinehart said the price premium for living in Chapel Hill compared to Durham, which the family had heard to be more than 30 percent, is not much when compared to moving from the Boston housing market.

"It didn't seem like a very big premium to pay," said Rinehart. He said the couple paid less money than for their house in Boston and got more in terms of space and quality of services.

"We'd like [our son] to go to public school, and we wanted to know that it would be a high quality public school," West said. "That's what meant the most to us."

Real estate agent Dianne Stabler of The Home Team said resale homes, like the one that West and Rinehart bought, have an advantage over new homes, which is why there is more of a price increase from a year ago.

"A number of these resale homes ... have been redone and gotten a facelift," said Stabler. "And for the most part, the lots are going to be bigger."

Carl Van Horn, who analyzes data for Market Opportunity Research, said other factors are driving up prices.

"There's just not any land available, nor do I think that the powers that are in Chapel Hill want aggressive development," Van Horn said.

West, in fact, noticed that there weren't many new houses available for purchase when she and her husband were house hunting.

"Orange County, and Chapel Hill in particular, is a market that has been getting smaller and smaller for its relative size to the Triangle," Van Horn said. "It's very hard for developers to do business in Chapel Hill."

Van Horn said that the interested buyers in Orange, facing a limited market, are starting to spill over into nearby counties. Durham, for example, had a 12-percent increase in closings compared to last year during the first quarter; nearly 2 percentage points higher than Orange's increase.

Stabler warned that there may be no near-term end to the climbing real estate prices.

"I just work on the basics of supply and demand," she said. "If you've got people to buy and not enough [houses], then that drives up the price."