Average home prices in the nation’s 20 biggest cities rose 2.2% in May from the prior month, according to a closely watched index, marking the second consecutive month of improvement.
It was the second gain after seven months of declines for the Standard & Poor’s/Case-Shiller index of 20 large cities. It was the strongest month-over-month percentage gain in more than a decade. The key index was still down 0.7% compared with May 2011.
“With May’s data, we saw a continuing trend of rising home prices for the spring,” David M. Blitzer, chairman of the index committee at S&P; Dow Jones Indices, said. “We have observed two consecutive months of increasing home prices and overall improvements in monthly and annual returns; however, we need to remember that spring and early summer are seasonally strong buying months so this trend must continue throughout the summer and into the fall.”
The May price data come after June sales statistics proved weak. The rise in housing values also comes at a tenuous time for the U.S. economy, with fears about an impending fiscal crisis at the end of the year beginning to hurt job growth domestically and concerns abounding over a broader global slowdown.
All 20 cities in the index posted positive monthly results. The May data showed that average home prices across the country were back to spring 2003 levels. Home prices are off about 33% from their peak in the summer of 2006.