The Standard & Poor's/Case-Shiller released today their 20-city home price index which rose 0.3 percent from November to December, to a seasonally adjusted reading of 145.87 which was the seventh straight monthly gain and yet another sign the nations housing market continues its slow recovery.
For most Americans, their home is their largest asset and as values climb homeowners in turn feel financially better off and are then more likely to spend.
Many homeowners throughout the country owe more on their mortgage than their property is worth and rising home prices do help to rebuild equity in their homes.
Being released later this week, home sales data for January is expected to show gains over year-end levels which could be a reflection of buyers taking advantage of low interest rates and temporary tax credits.
Anna Piretti, an economist at BNP Paribas, wrote in a research report, "While conditions remain challenging in Florida, house price conditions appear to be improving in the Western states, with gains recorded in California, Nevada and Arizona."
Los Angeles and Phoenix posted the largest price increases while prices lowered in other key markets like New York, Miami and Chicago. Also, Denver's prices rose for the 10th month in a row, while San Francisco saw its eighth monthly gain.
With people realizing the bottom is fading away, buying activity in the San Francisco area is heaviest among homes priced between $600,000 and below, with more and more listings receiving multiple offers above the asking price.
However, not everything is coming up roses because there are still many obstacles that could derail the housing market recovery.
First of all, consumer confidence took a sharp fall in this month from rising job worries which ended three straight months of improvement and furthermore, about 5 percent of homeowners with a mortgage are now in foreclosure.
Also, after two federal tax credits expire in April, some economists fear that the demand for homes and prices will fall once again.
Michelle Meyer, an economist with Barclay's Capital Research recently wrote in a research report, "The most likely outcome is that it will take years to work through the glut of foreclosures, keeping home prices bouncing around the bottom for quite some time."
Homes today are selling a little bit faster, provided that they are priced right and if employment can show gains that will also help a great deal.