Rising Optimism in Housing Doesn't Compute

By Diana Olick, CNBC Real Estate Reporter

NEW YORK ( CNBC) -- An increasing number of Americans are starting to believe in home price appreciation again.

Perhaps it's the excitement of an early spring market, perhaps the fact that unemployment has been steadily easing, or perhaps just the fact that we haven't had an economic "crisis" in a good, solid six months.

Whatever the reason, 33% of respondents to Fannie Mae's monthly housing survey in March said they expect home prices to rise, and rise an average 0.9% over the next 12 months. That's the highest percentage of believers in over a year, and up a full five percentage points from February.

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"Conditions are coming together to encourage people to want to buy homes," said Doug Duncan, Fannie Mae's chief economist in a news release. "Americans' rental price expectations for the next year continue to rise, reaching their record high level for our survey this month. With an increasing share of consumers expecting higher mortgage rates and home prices over the next 12 months, some may feel that renting is becoming more costly and that homeownership is a more compelling housing choice."

It may be a more compelling choice, and if you're one of the 33% who think you stand to profit on the investment, and if you have the ability to obtain a mortgage or the cash to put down, then you will likely act on that choice. But that's a lot of ifs, and gauging home prices today is next to impossible.

Don't get me wrong, there are any number of data providers who will tell you that their reading on current home prices is "the" one to follow, and that all the others are "off" in some way. First you have to decide if you want to use a survey that includes sale prices of foreclosed homes and/or short sales (when the home is sold for less than the value of the mortgage). I'm not going to even dip into the treacherous waters of weighing these reports against each other, as that is a fool's errand, but I will say that they all show home prices continuing to fall.