Average home prices grew by 2.2% from April to May, according to the latest Standard & Poor’s/Case-Shiller Home Price Indices report.

The 2.2% price increase is tied to both the 10- and 20-city composite indices studied by S&P.  

“The 10- and 20-city composites were each up 2.2% for the month and recorded respective annual rates of decline of 1% and 0.7%, compared to May 2011,” S&P said Tuesday. “While still negative, these annual changes are the best we’ve seen since in at least 18 months.”

The S&P Case Shiller also noted that 17 of the 20 metropolitan areas studied in its report saw increases in annual price returns when comparing the months of April and May.

The cities where prices continued to waiver included Boston, Charlotte and Detroit, with their annual price returns hitting -0.1%, a slight 0.9% and 0.6%, respectively.

Atlanta remains a bear market with the city posting a double-digit negative annual price return rate of -14.5%. Still, Case-Shiller calls that change greatly improved from the negative 17% annual decline reported in Atlanta back in April.

Phoenix, on the other hand, has gone from cold to hot with prices on the rise.

“Taking a closer look at the cities, Phoenix again posted the best annual return,” the S&P Case-Shiller said. “Average home prices in that region were up 11.5% versus May 2011. It was one of the hardest hit cities in the collapse, and prices are still more than 50% below their June 2006 peak, but the past five months have been positive for that market.”

Other formerly cold markets with positive annual return rates included Miami and Tampa.

Looking at the latest data, the S&P Case-Shiller is cautiously optimistic about home prices and the real estate market.

“June data for existing home sales, new home sales, housing starts and mortgage default rates were a bit mixed, but all are better than their year-ago levels,” the report said. “The housing market seems to be stabilizing, but we are definitely in a wait-and-see mode for the next few months.”

Capital Economics released a statement on the report, saying “the fourth successive rise in the Case-Shiller measure of seasonally-adjusted house prices means that prices are experiencing more than just their usual seasonal lift.” The research firm added, “Moreover, tight supply conditions and an underlying improvement in demand suggest that prices are not going to give up all of these gains in the second half of the year.”


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