Home prices rose by a seasonally adjusted 0.2 percent in February, the first increase since March last year, according to ""Lender Processing Services"":http://www.lpsvcs.com/Pages/default.aspx (LPS).[IMAGE]
The analytics and data provider said that several other indicators posted solid gains in February. Home prices averaged $195,000, the same as seen in June 2003. LPS also projected a 0.3 percent increase in national home prices on the whole come March.
Of 26 metro areas surveyed by LPS and the Labor Department, only cities in California ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô Los Angeles, San Diego, and San Francisco ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô observed price declines in February.[COLUMN_BREAK]
By the same token, cities that saw increases in prices by more than 1 percent included Honolulu, Portland, Tampa, and Seattle. Prices went up in cities in 20 other states.
The company cautioned against optimism despite signs of strength elsewhere in the housing market.
""Without a pickup in sales volumes from their current anemic levels, it's hard to be more optimistic that the market may be nearing the end of its fall,"" ""Raj Dosaj"":http://www.linkedin.com/pub/dir/Raj/Dosaj, VP of applied analytics with the company, said in a statement. ""Reasons for caution are clear, as we've been here before.""
He cited a pickup in non-seasonally adjusted prices before their deflation in each of the last three years, shifts that erased gains by summertime.
""[T]he inventory of distressed homes remains high, which will continue to put a drag on prices,"" he added.
Economists with other groups seem to suggest that home prices will hold up in the face of higher figures for mortgage applications and pending-home sales.
""Recent data have reignited fears of another sharp summer slowdown in economic growth,"" ""Paul Diggle"":http://www.capitaleconomics.com/staff/property-economics/paul-diggle.html, a property economist with consultancy ""Capital Economics"":http://www.capitaleconomics.com/, said in a note Wednesday. ""But we think that the recovery will hold up.""