The Denver-area housing market showed the most appreciation of any major market outside of California cities and Boston, according to a national second-quarter report released this week.

Denver-area homes gained an average of 2.5 percent in the second quarter from the same period in 2009, according to the report by Zillow.com. hat compares with an overall drop in value of 3.2 percent for the nation.

When Zillow looked at the 25 largest metropolitan statistical areas, Denver ranked No. 6. Four of the cities showing bigger increases than Denver were in California. San Diego was No. 1 at 7.3 percent. San Francisco was up by 5.9 percent; San Jose, 5.6 percent; and Los Angeles, 5.5 percent. . Boston home prices rose by 3.2 percent. Miami – Fort Lauderdale showed the biggest decline, falling by 15.2 percent, while Phoenix homes prices fell by 11.8 percent.

Denver’s ranking no surprise

Denver’s relative performance to most markets, ”does not surprise me,” said Lane Hornung, president of 8Z Real Estate and an owner of COhomefinder.com. “Especially when you take out San Francisco, San Diego and Boston – where home prices have been fallen so much more, so now that they have started to recover, their increases are amplified so much more, Denver really is one of the better performing cities relative to other places in the country. Denver is starting to show nice, steady appreciation, without the huge amount of ups and downs as some other places.”

That’s not to say everyone who bought a home has seen it appreciate.

“If you bought at the worst time, in a location where land was plentiful, you’re hurting,” Hornung said. “When you bought your home if you could stand on your driveway and see nothing but plains around you, you’re in trouble.”

He said a “good analogy” is to compare those areas to “foreclosure alleys,” instead of a “tornado alley.”

From the first quarter to second quarter, Denver-area homes gained 1 percent, compared with a 0.6 percent quarter-to-quarter overall all decline for the nation as a whole, according to Zillow. · Negative equity dipped in the second quarter, with 21.5 percent of all single-family homes with mortgages underwater, down from 23.3 percent in the first quarter.

Negative equity, the percentage of single-family homeowners with mortgages who are underwater, fell from 23.3 percent in the first quarter, and from 23 percent a year ago. Denver, however, showed a negative equity of 29.1 percent, according to Zillow.

Mixed-bag for nation...

See the full real estate news article on Inside Real Estate News

John Rebchook is a Colorado real estate reporter who shares his insight with COhomefinder.com and 8z Real Estate