The NAR also shows that new-home purchases are up 7% on a year-to-year basis, and that's going to help boost U.S. home values. In fact, the NAR estimates median U.S. home price to rise by 7.5% this year, buoyed by the sale of 5 million homes across the country. That figure largely corresponds with home value indicators coming out this week. The S&P/Case-Shiller Home Price Indices released April 30 shows home prices rising 9.3% for its 20-U.S. city composites for the 12 months ending February. Southern U.S. housing markets are really rolling, S&P/Case-Shiller reports, with Phoenix averaging a year-over-year return of 23% and Atlanta and Dallas clocking in with the highest annual growth rates in the history of these indices since 1992 and 2001, respectively. "Home prices continue to show solid increases across all 20 cities," says David M. Blitzer, chairman at S&P Dow Jones Indices. "The 10- and 20-city composites recorded their highest annual growth rates since May 2006; seasonally adjusted monthly data show all 20 cities saw higher prices for two months in a row. The last time that happened was in early 2005." Those southern cities, along with San Francisco, have a good reason for their high home value growth rates: They were among the U.S. markets that sank the furthest, and consequently had more room to climb, price-wise. "Phoenix, San Francisco, Las Vegas and Atlanta were the four cities with the highest year-over-year price increases," Blitzer says. "Atlanta recovered from a wave of foreclosures in 2012, while the other three were among the hardest hit in the housing collapse. At the other end of the rankings, three older cities -- New York, Boston and Chicago -- saw the smallest year-over-year price improvements." The NAR adds that so-called pending sales, where a home purchase deal is inked but not finalized, have reached "above year-ago" levels for the past 23 months. The primary obstacle holding back even further growth for the U.S. housing market is supply, which the NAR says is growing more scarce. "Contract activity has been in a narrow range in recent months, not from a pause in demand but because of limited supply," says Lawrence Yun, the NAR's chief economist. "Little movement is expected in near-term sales closings, but they should edge up modestly as the year progresses. Job additions and rising household wealth will continue to support housing demand."
Even as limited supply moderately threatens housing market growth, it's still been a banner year for homeowners and the economy. The housing sector isn't back at full strength yet, but it's starting to flex some muscles not seen in years.