House prices in 20 major metropolitan areas rose 1.3% in May from April and 4.6% from a year earlier, according to the latest Standard & Poor’s (S&P)/Case-Shiller House Price Index (HPI). The 10-city composite index similarly rose 1.2% from last month and 5.4% from last year: The May composites are largely in line with expectations, as economists anticipated a 4% year-over-year rise in the 20-city index in May. Authors of the index are warning that, despite the positive results, prices have essentially remained flat over the past seven months. The May results widened from the April S&P/Case-Shiller, which found the 20-city composite grew 3.8% and the 10-city composite grew 4.6% from a year earlier. Positive month-on-month results in 12 of the metropolitan statistical areas (MSAs) fed into positive monthly changes for both composites in May. Authors of the index warned, however, that the positive May results might be attributed to strong seasonal trends and “residual impact” of the first-time homebuyer tax credit. “We need to watch where the housing market will go after these temporary stimuli go away,” said managing director of the S&P indices David Blitzer. “June’s existing and new home sales and housing starts data have not shown real improvement either.” He added: “It still looks possible that the housing market might bounce along the bottom for the foreseeable future before showing any real improvement that will filter through to the rest of the economy.” Blitzer also noted a look at house price levels over the past year do not indicate a “sustained recovery” in housing. Instead, he said, the two composites improved between 5% and 6% since housing’s April 2009 trough and are now registering around what was seen in October of 2009. “The last seven months have basically been flat.” Write to Diana Golobay.

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