Home prices rose more than expected in June, the fifth month in a row of gains in a fresh sign of improvement in the housing market, a closely watched survey showed on Tuesday.
The S&P/Case Shiller composite index of 20 metropolitan areas gained 0.9 percent on a seasonally adjusted basis, topping economists' forecasts for 0.5 percent, according to a Reuters poll. On a non-seasonally adjusted basis, prices were even stronger, up 2.3 percent.
"We seem to be witnessing exactly what we needed for a sustained recovery; monthly increases coupled with improving annual rates of change," David Blitzer, chairman of the index committee at Standard & Poor's, said in a statement. "The market may have finally turned around."
Prices in the 20 cities rose 0.5 percent compared to the year before. Atlanta fared the worst, tumbling 12.1 percent from a year ago. Phoenix continued to bounce back from poor conditions and was up nearly 14 percent.
Although prices in June likely got a boost from the traditionally strong summer buying season, the gains on both a monthly and yearly basis boded well for the housing market, said Blitzer.
The report affirmed "that the overall market is healing, albeit at a frustratingly slow pace," said Stan Humphries, chief economist at Zillow.
Humphries said he expects to see prices weaken in the latter half of the year, though the period of sustained declines are likely in the past.
For the second quarter, seasonally adjusted national prices jumped 2.2 percent compared to the 1.4 percent gain that was seen in the first quarter.
Financial markets saw little reaction to the data as investors had their attention turned to a highly anticipated speech from Federal Reserve Chairman Ben Bernanke at the end of the week.
(Reporting by Leah Schnurr)