Home prices continued their upward trajectory, nearing 10%, according to data through February 2013 released Tuesday in the S&P/Case-Shiller Home Price Indices.
The 10- and 20-city composites showed average home prices increased 8.5% and 9.3%, respectively, in the 12 months ending in February 2013.
Meanwhile, from January to February, the 10- and 20-city composites rose 0.4% and 0.3%.
Although eight MSAs posted monthly drops, all 20 cities showed increases when compared to their February 2012 levels. Atlanta, Detroit, Las Vegas, Los Angeles, Miami, Minneapolis, Phoenix, San Diego, San Francisco and Tampa all experienced double-digit year-over-year gains.
“The 10- and 20-City Composites recorded their highest annual growth rates since May 2006; seasonally adjusted monthly data show all 20 cities saw higher prices for two months in a row – the last time that happened was in early 2005,” said David Blitzer, chairman of the index committee at S&P Dow Jones Indices.
Of the 20 cities covered by the indices, all reported year-over-year increases for at least two consecutive months. Phoenix led the growth with a 23% year-over-year return. San Francisco, Las Vegas and Atlanta took the next three slots with an 18.9%, 17.6% and 16.5% year-over-year return, respectively.
Blitzer noted, “Atlanta recovered from a wave of foreclosures in 2012 while the other three were among the hardest hit in the housing collapse. At the other end of the rankings, three older cities – New York, Boston and Chicago – saw the smallest year-over-year price improvements.”
But with prices appreciating throughout the country and buyers facing multiple offers on homes, many are wondering if we are in another bubble. Redfin’s Chief of Real Estate Operations, Scott Nagel, says this is a question his agents are constantly asking.
“The catastrophic bubble that popped five years ago was plagued with faulty loans,” said Nagel. “In contrast, today’s rapidly rising home prices are largely driven by the abundance of all-cash offers and a lack of inventory. And when the home purchases are financed, appraisals and other tight lending practices are keeping home prices more in check.”
Analysts at Econoday agree, noting that this report only further strengthens the notion that housing is headed back to healthy again.
“This report underscores the healthy gains in last week’s FHFA price report and confirms a pivot higher for home prices, a pivot that promises to be a special story for this year’s economy. This report should boost confidence in the housing sector and be a solid plus for today’s session,” Econoday said.