NEW YORK (Reuters) - Home prices rose at the beginning of the year, another sign the recovery in the housing market is gaining traction, data from CoreLogic showed on Tuesday.

CoreLogic's home price index rose 0.7 percent in January from the previous month and jumped 9.7 percent compared to a year ago. It was the biggest yearly increase since April 2006 and the 11th month in a row that prices have increased.

Excluding distressed sales, prices rose 1.8 percent on the month and were up 9 percent from the previous year. Distressed sales include homes that are in danger of foreclosure or have already been seized by lenders and are often sold at a significantly reduced price.

All but two states - Delaware and Illinois - racked up yearly gains.

The report forecast prices would fall by 0.3 percent in February as part of a typical winter slowdown. Still, for the year they are seen up 9.7 percent.

"With these gains, the housing market is poised to enter the spring selling season on a sound footing," Mark Fleming, chief economist at CoreLogic, said in a statement.

Of the top 100 statistical areas measured by population, 92 showed year-over-year gains, up from 87 in December.

(Reporting by Leah Schnurr; Editing by Chizu Nomiyama)