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Home prices rise 5%

Clear Capital, a provider of real estate data, says home prices climbed 5% nationally in February from a year ago. The prices grew 2.3% in January on an annual basis. Among metropolitan areas, Providence, Rhode Island saw the highest rise of 6.1% from the earlier quarter. California had 5 of the 15 highest performing markets. The rise in prices is likely to be sustained as the tax credit deadline approaches in April. “If the increase in demand that preceded the end of the last tax credit is any indication, home prices may dip only slightly into negative territory before getting an added boost before the April tax credit deadline,” said Alex Villacorta, senior statistician at Clear Capital. The firm has expressed optimism despite the likely impact of REOs – properties that go back to the mortgage company after an unsuccessful foreclosure auction – on home prices in the coming months. “Although many markets have seen a slow down in price gains, I’m encouraged that p rices have remained positive through the first two months of the year despite all the negative economic news and threat of more REOs hitting the markets,” Villacorta said.