Mortgage insurer PMI released a report Monday indicating that the housing market is recovering and predicting that prices are likely to rise in many markets over the next two years. PMI considerations include increasing affordability, generally improving mortgage credit quality, decreasing foreclosure rates, and a drop in excess housing supply.

Key findings include:

  • Of the nation's 384 MSAs (metropolitan statistical areas), 356 had a declining risk score, with only one showing a slight increase and the remainder unchanged.
  • The number of MSAs in the riskiest category fell by 26.4 percent during the fourth quarter.
  • The number of MSAs in the least-risky category increased 26.5 percent.

Large MSAs with the most improved risk scores are:

  • Columbus, Ohio
  • Pittsburgh
  • Memphis
  • Charlotte, N.C.
  • St. Louis
  • San Antonio, Texas
  • Kansas City, Mo.
  • Nashville, Tenn.
  • Chicago-Naperville
  • Indianapolis