NEW YORK ( TheStreet) -- Home prices are rising at a scorching pace in Phoenix, Las Vegas and San Francisco, but the real housing recovery story is in Texas.
National home prices are still about 20% below their June 2006 peak, but in Texas home prices are now at a new peak, according to data from Lender Processing Services.
Home prices in Texas inched up 0.7% in March over the previous month and are up 4.7% year-over-year. Those are mild gains compared to the average gains reported by other states in the U.S.
The LPS Home Price Index (HPI) rose 1.4% in March over the previous month and was up 7.6% on a year-over-year basis. The LPS index, unlike other indices, excludes the impact of foreclosures and short sales.
The widely followed S&P Case-Shiller Home Prices Indices were also released Tuesday. The national composite index recorded a 10.2% gain in the first quarter of 2013 over the first quarter of 2012. The 10-City and 20-City Composites posted annual increases of 10.3% and 10.9%, respectively, in March. Still, the Texas cities of Austin and Dallas are seeing home prices at new highs, according to LPS. Meanwhile, home prices in Houston are just 0.3% below the previous June 2007 peak, while San Antonio home prices are just 2.1% below their August 2007 peak. Colorado is another state that is very close to its previous peak with home prices just 0.7% off June 2007 highs. The housing market in Denver is at a new peak. Despite soaring home prices in Arizona and California, however, these states still have a long uphill road to full recovery. Home prices in Arizona are still down 35% from their May 2006 peak, while in California, home prices are nearly 32% below the April 2006 peak.
While the recovery in home prices in other states is a rebound from dismal lows, the recovery in Texas appears to be backed by strong underlying fundamentals.