Home prices increase but still largely flat

Home prices increased 4.6 percent in May across 20 U.S. cities from the same time in 2009 as a federal tax credit boosted sales. 

The increase reflected the largest year-over-year gain since August 2006 but homes prices are still considered flat since last fall, according to a S&P/Case-Shiller index of property values released Tuesday. 

“While May’s report on its own looks somewhat positive, a broader look at home price levels over the past year still do not indicate that the housing market is in any form of sustained recovery,” said David Blitzer, chairman of the Standard & Poor’s index committee. 

Home prices could remain flat and even weaken slightly with the demand for homes dropping since the April 30 expiration of the federal tax credit, worth as much as $8,000 for homebuyers. 

“Since reaching its recent trough in April 2009, the housing market has really only stabilized at this lower level," Blitzer said. "The two composites have improved between 5 and 6 percent since then, but this is no better than the improvement they had registered as of October 2009. The last seven months have basically been flat.”