U.S. house prices rose 10.2% from March 2012 to March 2013, the largest year-over-year increase in close to seven years, according to the S&P/Case-Shiller Home Price Index.
The increase brings U.S. house prices back to their 2003 levels, according to the report.
The 10-city index rose 10.3%, while the 20-city index rose 10.9%. On a month-over-month basis, the 10- and 20-city indexes each posted an increase of 1.4%.
‘Home prices in all 20 cities posted annual gains for the third month in a row,’ noted David M. Blitzer, chairman of the Index Committee at S&P Dow Jones Indices. ‘Twelve of the 20 saw prices rise at double-digit annual growth.’
Year-over-year, Phoenix had the largest increase at 22.5%, followed by San Francisco with 22.2% and Las Vegas with 20.6%. Miami and Tampa posted annual gains of 10.7% and 11.8%, respectively.
The weakest annual price gains were in New York (+2.6%), Cleveland (+4.8%) and Boston (+6.7%). However, Blitzer noted that ‘even these numbers are quite substantial.’
Blitzer said the trend is shored-up by other industry data showing increases in housing starts as well as sales of new and existing homes.
However, ‘the larger than usual share of multifamily housing, a large number of homes still in some stage of foreclosure and buying-to-rent by investors suggest that the housing recovery is not complete,’ he said.
Although home prices have now returned to 2003 levels, they remain 28% below their June/July 2006 peak.
And there's still plenty of room for improvement: According to Zillow, roughly 25% of U.S. homeowners were still underwater with their mortgages in the first quarter of 2013, down from 27.5% in the fourth quarter of 2012.