By Steve Goldstein, MarketWatch
WASHINGTON (MarketWatch) — U.S. home prices bounced higher for a second month in June, according to an index released Tuesday which showed the strongest back-to-back monthly advance in the more than decade-long history of the price gauge.
The S&P/Case-Shiller 20-city composite index registered a 2.3% advance in June, matching upwardly revised gains in May and taking the year-on-year move to positive territory for the first time in close to two years with a gain of 0.5%.
All 20 cities managed monthly gains, including a 6% surge in hard-hit Detroit and a 4.8% advance in Minneapolis. Prices in the second quarter gained 6.9% compared to the first quarter.
“We seem to be witnessing exactly what we needed for a sustained recovery; monthly increases coupled with improving annual rates of change. The market may have finally turned around,” said David Blitzer, chairman of the index committee at S&P Dow Jones Indices.
Even with the gains, prices have still fallen a long way from their 2006 peaks — roughly 31%.
The Case-Shiller index is unique in that it measures prices on a three-month rolling basis, so June’s figures include transactions in April and May.
Other house-price measurements have shown even stronger moves. CoreLogic reported a 2.5% year-on-year gain, and a measure of prices on mortgages bought or guaranteed by Fannie Mae or Freddie Mac showed a 3.6% gain.
Sales activity has been climbing even more rapidly than prices, with the three-month average of new home sales up 21% compared to the same period a year ago. See slides of recent economic indicators.
Near-record-low mortgage rates and a slowly improving jobs market have helped contribute to the improving housing picture. There also is less distressed activity, which helps keep prices higher.
Steve Goldstein is MarketWatch's Washington bureau chief.
