Another sign emerged that the nation's struggling housing market may be nearing its bottom as a widely followed national home-price index posted its first gain in nearly three years.
The S&P/Case-Shiller index of home prices in 20 metropolitan areas was up slightly in May over its April level for the first time since 2006.
Cleveland, Dallas and San Francisco showed the largest gains in May figures released Tuesday, but Los Angeles prices continued to fall. The index was the latest surprise following reports showing monthly gains in new-home sales and housing starts nationwide, and higher median home sales prices in California.
"The data do show for the first time in quite a few years some potential signs of turnaround," said Maureen Maitland, vice president of index services at Standard & Poor's.
But "in terms of a sustained recovery, we're not out of the woods yet," Maitland cautioned. "What we need is for this to continue for quite a few months."
The nationwide index of house prices was still down 17% in May from the same month last year. But the rapid deterioration in prices has slowed since January.
Many housing market analysts agree that cheers over a few bright spots in the data must be weighed against a more complex range of indicators. Home prices are still falling in many areas, with high unemployment and looming foreclosures likely to weigh down real estate for the foreseeable future.
Even the May index rise over April -- by a half-percentage point -- turns out to be a decline when adjusted for seasonality.
May is a busy month for home sales, which usually bumps prices up. Seasonally adjusted, the index for May was down by nine-tenths of a percentage point from April.
The slowing decline in home prices means "the free fall housing has been in is clearly over," said Dean Baker, co-director of the Center for Economic and Policy Research in Washington. "But I'm not confident at all we're seeing the end of the period of price declines."
Mortgage interest rates and unemployment are rising, and "we continue to have a massive oversupply of houses by every measure," he said.
Such mixed signals are prompting confusion for homeowners and potential home buyers, and it brought warnings from veteran housing market observers.
