In relation to a story that my good friend and colleague Jerry Dahmen had a while back regarding the Sioux Falls housing market being hot, here's a look at things from a national perspective.

Market researcher CoreLogic says prices were up 4.6% in August from a year ago, the largest year-over-year gain in six years. The report parallels others showing recent strengthening in home prices, which are still down about 30% from their 2006 peak.

Much of the recent increase is traceable to tightening supplies of homes for sale. In August, existing single-family home sales were up 9% year over year, but the supply of listed homes for sale was down 18%, according to the National Association of Realtors.

"Inventories drive prices," says Christopher Thornberg, an economist with Beacon Economics.

As home prices rise, more people will eventually list homes for sale. And as they do, price gains may slow, says Zillow economist Stan Humphries.

August was the sixth consecutive month that home prices were up on a month over month basis, CoreLogic says. That is a reversal from last fall, when prices were still falling. CoreLogic expects September home prices were up 5% year-over-year, too. But, it says they likely slipped 0.3% in September from August as the summer season ended.

"As people perceive that prices have bottomed, they're coming back into the market," says Mark Goldman, real estate expert at San Diego State University.

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