Price Gains Continue to Build Up Steam

FNC, Inc.’s Residential Price Index (RPI) once again picked up its clip in February, rising at the highest annual rate in nearly eight years, the company reported.

The national index, created to gauge price movement among “normal” home sales (exclusive of distressed properties), climbed 9.1 percent year-over-year in February, bringing it back to levels last seen at the peak of the housing market in June 2006 as non-distressed sales gain market share.

The two narrower composites measuring 30-city and 10-city price changes ratcheted up even higher, rising 10.7 percent and 11.5 percent yearly, respectively, with price momentum picking up in most of the country.

“The momentum is expected to pick up as Spring home buying is getting into full swing, even absorbing the slack caused by the bad weather that affected much of the country,” FNC said in its monthly report.

On a monthly basis, the national index rose 0.5 percent—the highest increase since November—while the 30- and 10-city composites were up 0.7 percent and 0.8 percent, respectively.

Breaking down the 30-city index, Sacramento and Chicago experienced the largest one-month gains at 2.9 percent each—a full percentage point higher than the next highest gain (Nashville at 1.9 percent).

While the rebound in Sacramento likely just reflects a comeback from an unexpectedly large decline the city saw in January, FNC says “home prices in Chicago are gathering momentum with February’s impressive gain following a strong January performance.”

Meanwhile, prices in nine other cities—including San Diego, Orlando, and Phoenix—continue to see solid improvements.

Six markets out of the 30-city composite posted negative movement: Baltimore (-0.9 percent); Denver (-0.3 percent); Minneapolis (-0.4 percent); Portland, Oregon (-0.9 percent); St. Louis (-0.4 percent); and Washington, D.C. (-0.7 percent). Prices stayed flat in San Antonio, the only city to see no change.