A report by the S&P/Case-Shiller Home Price Index released Tuesday showed that home prices in the nation's largest metropolitan cities rose 9.3% over the last year ending in February, making it the largest gain in 7 years.
"Despite some recent mixed economic reports for March, housing continues to be one of the brighter spots in the economy," David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.
"The 2013 first quarter GDP report shows that residential investment accelerated from the 2012 fourth quarter and made a positive contribution to growth. One open question is the mix of single-family [homes] and apartments; housing starts data show a larger than usual share is apartments," he added.
The seasonally adjusted 20-city home price index rose 1.2 percent month-to-month in February, the 13th consecutive gain. In January, the index rose 1 percent, according to the report released Tuesday.
Home prices rose 23% from one year ago in Phoenix and 18.9% in San Francisco. Nationally, the median home price in March stood at $184,300, well below the peak of $230,400 in 2006 but up from $154,600 in January 2012.
"For the 65 percent of households that own their home, rising prices boost wealth," said Jim O'Sullivan, chief U.S. economist with High Frequency Economics.
On a year-over-year basis, the index increased 9.3 percent, up from 8.1 percent in January, the strongest since prices began to slow in 2006, O'Sullivan said.
