US Home Prices Rise 12.2 Percent In May, Best Yearly Gain Since March 2006

U.S. home prices jumped by a robust 12.2 percent in May compared with the year earlier gain of 2.4 percent, according to the S&P/Case-Shiller home price index, which was released on Tuesday.

Economists expected a 10.5 percent uptick, lower than last month’s 12.1 percent annual gain, according to Briefing.com, so the result solidly beat expectations.

Both the monthly and yearly gains were remarkably strong, with the benchmark 20-city composite posting the best annual gain since March 2006. Home prices in all 20 cities covered by the index posted both monthly and annual gains, a rare feat.

Average home prices are back to spring 2004 levels, as of May 2013, said a news release accompanying the index. Last month, the index posted a 1.1 percent monthly gain.

Dallas and Denver also beat their pricing peaks set before the financial crisis, in new record home prices there.

According to data released on Monday, pending U.S. home sales fell slightly in June, by 0.4 percent. Barclays economist Cooper Howes wrote in a note to investors that the housing market will nonetheless continue to improve throughout 2013 and into 2014.

The S&P/Case-Shiller index is based on a survey of single-family home prices in 20 cities. The index has posted increases every month since February 2012.