For the first time since 2006, national home prices survived winter without experiencing a quarterly decline, according to Clear Capital’s market report for March.
Home prices ended last month with a 6.5 percent year-over-year improvement, while the quarterly gain was a modest 0.9 percent.
“It has been seven years since home price growth continued throughout winter. This is very strong evidence of the start to a new leg of the recovery, one that should give further confidence to consumers and lenders alike that the recovery is real,” said Dr. Alex Villacorta, director of research and analytics at Clear Capital. “As buyers become more confident the recovery is sustainable, this sentiment should grow to create a positive feedback loop.”
Over the next three quarters, Clear Capital is projecting growth of 1.7 percent, which would bring the 2013 forecast to 2.6 percent.
On a regional basis, Clear Capital found quarterly growth was the strongest in the West, where prices were up by 2.2 percent. The Northeast and South each saw prices grow 0.7 percent, while prices in the Midwest increased 0.3 percent quarter-over-quarter.
On a yearly basis, the West also saw the strongest price gains, at 14.5 percent. The South came in at second with a 5.1 percent annual increase, followed by the Midwest (+4.2 percent) and the Northeast (+3.0 percent).
According to Clear Capital’s forecast, the Northeast will lead price growth over the next three quarters with a 2.1 percent gain.
The Midwest and South should experience a 1.9 percent and 1.8 percent increase, respectively, while the West will grow by just 0.7 percent.
“Recovering hard hit markets, like the West, could see buyer interest cool due to rising prices, while more fair market sellers might help boost supply,” the report explained.
On a more microscopic level, data from Clear Capital found hard hit markets such as Las Vegas, Phoenix, Atlanta, and Sacramento each posted quarterly price increases above 3 percent.
Though, gains in Phoenix are expected to grow at a much more moderate pace at just 4.7 percent over the next three quarters compared to 26.8 percent last year.
“Phoenix is a great example where we expect to see that cooling trend support a more sustainable recovery. After a strong year of growth, rising prices should bring the metro back into a more normal range of growth,” Villacorta added.
The data provider, however, has high expectations for Seattle, where prices are projected to finish at 6.9 percent over the next 9 months.
While most of the major markets analyzed are expected to see an upward movement in prices, small declines are projected over the next three quarters in three metros: Cleveland (-0.8 percent), Charlotte (-0.7 percent), and Cincinnati (-0.6 percent).