NEW YORK (CNNMoney.com) -- February home prices posted their first year-over-year increase since December 2006, according to a report out today.
Home prices inched up 0.6% compared to February 2009 according to the S&P/Case-Shiller 20-city index, with nine of the 20 cities showing gains.
"The homebuyer tax credit, available until the end of April, is the likely cause for these encouraging numbers," said David Blitzer, chairman of the index committee at S&P.
But home prices actually fell by 0.9% compared with January. The dip was small enough to put prices in positive territory compared with 12 months earlier, when home prices were falling very steeply.
Indeed, 18 cities saw month-over-month price declines in February and six cities, including New York, Las Vegas and Seattle, posted new lows for this downturn.
"These data point to a risk that home prices could decline further before experiencing any sustained gains," said Blitzer. "It is too early to say that the housing market is recovering."
As of February, prices are about where they were in the Fall of 2003. Prices for the 20-city index are down 32.6% from their peak in July 2006, wiping out all of the gains from the housing boom.
The best performing market in February was San Francisco, which posted a double-digit gain over the past 12 months of 11.9%. San Diego home prices jumped 7.6% and Los Angeles gained 5.3%.
"California had very steep declines during the downfall and now people are rushing to catch the market on its way up," said Lawrence Yun, the chief economist for the National Association of Realtors.
The biggest loser continued to be Las Vegas, where prices dropped 14.6% over the past 12 months.
S&P's Blitzer warned that housing markets still have some deep problems that could derail any recovery. Chief among them is the foreclosure crisis.
"As [foreclosures] are put up for sale, we may see some further dampening in home prices," he said.
But David Crowe, the chief economist for the National Association of Home Builders, expects home prices to remain stable for some time.
"We're in for a period of wandering around zero [price gains]," he said, "with some months up and some down but with the general trend slightly upward."
"Starter home builders in the central part of the country are most confident," said Crowe. "They're least optimistic in the bubble states like California, Nevada, Arizona and Florida, and the auto industry areas."
An upturn in the confidence level of both buyers and sellers was ushered in by federal stimulus programs, according to Yun, especially the homebuyer's tax credit and the Federal Reserve's move to purchase mortgage-backed securities. That made it easier to obtain financing.