EHIXIBIT 99.1


AMERICAN
HOMESTAR                                    Contact:  Craig Reynolds
CORPORATION                                           Chief Financial Officer
                                                      (281) 334-9702
                                                      e-mail: craig@hstr.com



     AMERICAN HOMESTAR CORPORATION ANNOUNCES SERIES C COMMON STOCK REPURCHASE
                                   TRANSACTION


HOUSTON, Texas (January 21, 2005) - American Homestar Corporation (AHMS.PK) (the
"Company")  today announced that it has purchased 1,341,597 shares of its Series
"C"  Common Stock, in a negotiated transaction, from one of its shareholders for
$1,019,614.  The  Company  did  not  solicit the offer nor does it have a formal
stock  repurchase  program  currently  in  place.  The  shares  will  be held as
treasury shares.

The Company issued Series "C" Common Stock to its former creditors in connection
with  the  Company's  reorganization  in  2001.  The  Series "C" Common Stock is
currently  traded on the Over-the Counter "Pink Sheets" Market under the trading
symbol "AHMS."

American  Homestar  Corporation  produces  and  sells  manufactured  homes (both
HUD-code  and  Modular)  from  its two production facilities in Texas and its 30
retail  centers in Texas, Oklahoma and New Mexico. The Company also arranges for
financing and insurance for its customers.

For more information contact the Company's website at www.americanhomestar.com
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