BOSTON – Just a year since the U.S. housing market hit bottom after the biggest plunge in eight decades, signs of excess are re-emerging.

An open house for a five-bedroom brownstone in Brooklyn priced at $949,000 drew 300 visitors and brought in 50 offers.

Three thousand miles away in Menlo Park, Calif., a one-story home listed for $2 million got six offers last month, including four from builders planning to tear it down to construct a bigger house.

In south Florida, ground zero for the last building boom and bust, 3,300 new condominium units are under way, the most since 2007.

The U.S. spring home-buying season has been marked by a frenzy of demand fueled by the Federal Reserve’s drive to push down borrowing costs, a scarcity of listings and Wall Street’s new appetite for foreclosed homes.

While values remain well below their peak, economists including Stan Humphries of Zillow Inc. and Mark Vitner of Wells Fargo & Co. assert prices in some areas are rising at an unsustainable pace — a dramatic shift from early 2012, when billionaire Warren Buffett said housing “remains in a depression.”

“It’s a big change from a year ago,” said Paul Willen, a senior economist at the Federal Reserve Bank of Boston. “You’ve gone from hearing horror stories about people losing money to hearing stories of frenzy — lots of traffic and multiple offers.”

U.S. home prices jumped almost 11 percent in March from a year earlier, the biggest gain since the height of the real estate boom in 2006, CoreLogic Inc. reported last week.

Values are rising faster than incomes, an indication that prices may fall in some cities once higher mortgage rates erode affordability, Humphries said.

Investor purchases will inevitably cool, adding another potential hit to the market, according to Vitner.

The gains in some U.S. areas aren’t sustainable for a healthy market, said Dean Baker, co-director of the Center for Economic and Policy Research in Washington.

“If prices keep going up at this rate for another six months, we will have a bubble, and people will get hurt,” he said in a telephone interview.

U.S. buyers spent three times their annual incomes on homes at the end of last year, and those properties were 15 percent pricier relative to incomes than before the housing bubble of the mid-2000s, according to data from Seattle-based Zillow.

Markets such as Silicon Valley, Southern California, Boston and New York will look expensive relative to incomes when mortgage rates rise, Humphries said.

“The Fed has put every home on sale because of its actions,” Humphries said in a telephone interview. “We’re not saying you should ignore the sale sign and not pay a cheaper price. We want people to be aware of the fact that this is unusual and not bake these expectations of high appreciation into their long-term calculus.”

The average rate for a 30-year fixed mortgage was 3.42 percent last week, and reached a record low of 3.31 percent in November, according to Freddie Mac. That compares with an average rate of 6.24 percent from 2001 to 2006.

It’s too early to say another bubble is emerging. So far, the biggest gains are limited to hard-hit markets such as Phoenix and Las Vegas and thriving job centers such as San Francisco, while prices are falling in cities such as Chicago and Indianapolis, according to CoreLogic.

Nationally, existing-home sales are about a third off a 2005 peak and home construction is down by 66 percent.

Also, in contrast to the easy lending of the boom years, mortgage standards are strict.

In areas such as Long Island, N.Y., and Omaha, Neb., price gains are within moderate growth levels of 3 percent to 5 percent, according to the National Association of Realtors.

In other cities, demand remains stagnant and the market is far from overheated.

Nationally, prices dropped so much during the crash that they remain about 7 percent undervalued, based on comparisons with historical prices, incomes and rents, Trulia Inc. said this week, introducing a feature on its website called “Bubble Watch.”

Still, the recent price surge has made eight U.S. markets — including Orange County, Calif.; Houston; and Portland, Ore. — overvalued, the San Francisco-based real estate data company said.

Of the 150 metropolitan areas tracked by the National Association of Realtors, nine out of 10 showed price increases in the first quarter from a year earlier and areas such as Silicon Valley, Calif.; Phoenix; Atlanta; and Reno, Nev. saw gains of more than 30 percent, the group said.

Prices declined in 17 markets, including Edison, N.J.; Champaign-Urbana, Ill.; and Allentown, Pa.

In much of the country, inventory has been drained by institutional investors such as Blackstone Group and Colony Capital buying single-family homes, often foreclosures, to turn into rentals, said CoreLogic Chief Economist Sam Khater.

Blackstone, the largest buyer in the United States, spent more than $4 billion on 24,000 rental properties last year.

Vitner, of Wells Fargo, said investors are buying properties as quickly as they can and when they leave, housing will take a hit. Investors accounted for 19 percent of sales in the U.S. in March and even more in some former bubble markets, according to the National Association of Realtors.

“The problem is if they don’t earn a high enough return, they all walk away,” Vitner said. “Investors accounted for a larger proportion of the housing recovery than people realize.”

In south Florida, 20 condominium towers with more than 3,300 units are under construction, according to Peter Zalewski, owner of Condo Vultures, a brokerage and consulting firm based in Miami.

Another 14,600 units are planned, about three-quarters of them for Miami-Dade County, where the crash left dozens of unfinished and failed condo projects, now mostly filled with renters, he said.

“I don’t think there’s any question that we’re in the early stages of the next great south Florida construction boom,” Zalewski said.

The conditions that have propelled prices up for the past year won’t last, said Joel Naroff, president of Naroff Economic Advisors Inc. in Holland, Pa.

“We’re eventually going to see mortgage rates increase, supply increase and affordability decline, so you probably cut price gains at least by half,” Naroff said. “It will be a slowdown, not a crash.”


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