WASHINGTON – Sales of new and existing homes continue to show growth, confirming a healthy recovery is underway in the housing sector.

Reports from the National Association of Realtors (NAR) show existing sales have been above year-ago levels for 20 consecutive months, while prices show 12 consecutive months of year-over-year price increases. Existing-home sales grew 0.8 percent in February to a seasonally adjusted annual rate of 4.98 million compared to January figures, and up 10.2 percent above the 4.52 million-unit level in February 2012. “February sales were at the highest level since the tax credit period of November 2009,” a statement by the group said.

"Job growth in the improving economy and pent-up demand are causing both home sales and rental leasing to rise,” Lawrence Yun, NAR chief economist, said in a statement. “Though home prices are rising much faster than rents, historically low mortgage rates are still making home purchases affordable. The only headwinds are limited housing inventory, which varies greatly around the country, and credit conditions that remain too restrictive."

Total housing inventory at the end of February rose 9.6 percent to 1.94 million existing homes available for sale, which represents a 4.7-month supply. Listed inventory is 19.2 percent below a year ago when there was a 6.4-month supply. The national median existing-home price for all housing types was $173,600 in February, up 11.6 percent from a year ago. According to NAR, February’s gain is the strongest since November 2005, when it was 12.9 percent above a year earlier.

Production of new homes also showed signs of growth in February. Nationwide housing production rose 0.8 percent to a seasonally adjusted annual rate of 917,000 units in February, according to figures from HUD and the U.S. Census Bureau. Single-family housing starts grew 0.5 percent in February to a seasonally adjusted annual rate of 618,000 units -- their highest level since June of 2008 -- while multifamily starts rose 1.4 percent to 299,000 units.

"[The] report indicates that, despite some bumps in the road, overall housing production continues on the solid upward trend that we saw throughout 2012," David Crowe, chief economist of the National Association of Home Builders (NAHB) said in a statement. "Moreover, further gains in permit issuance are a positive sign that home construction will continue to drive economic and job growth in the coming months, albeit at a slower pace than would be possible without certain limiting factors."

Yet despite the continued gains in production, builder confidence fell 2 points to 44 on the NAHB/Wells Fargo Housing Market Index (HMI). "Although many of our members are reporting increased demand for new homes in their markets, their enthusiasm is being tempered by frustrating bottlenecks in the supply chain for developed lots along with rising costs for building materials and labor. At the same time, problems with appraisals and credit availability remain considerable obstacles to completing deals," NAHB Chairman Rick Judson, a home builder from Charlotte, NC, said in a statement.