For the second month in a row, Phoenix is leading the recovery in the housing market, with an 8.4 percent quarterly increase in home prices and a year-over-year increase in March of 12.5 percent, according to Clear Capital's Home Data Index.

The Miami-Fort Lauderdale, Florida market was in second place with a monthly increase of 4.6 percent.

Clear Capital's Alex Villacorta says the time may still not be right for builders to start putting up subdivisions, because of where the home price growth is taking place.

"The low-price tier that we track has seen year-over-year prices gain almost 17 percent over the last year. And you compare that to the top end of the market that has seen still positive growth, but not nearly as high, at 5 percent," Villacorta said.

Villacorta says investors have been pumping up housing demand by buying foreclosure properties, refurbishing them and turning them mainly into rental properties. And he says he expects a continuing demand for rental homes, largely as a result of families with credit problems.

EDITOR'S NOTE (5/2/2012): An earlier version of this story misspelled Alex Villacorta's name.