An index of Chicago-area home prices posted its first monthly increase in almost three years, a sign that the battered residential market may be in the early stages of recovery.
Home prices in the Chicago area rose 1.1 percent in May compared with the previous month, according to the Standard & Poor's/Case-Shiller Home Price Indices.
The Standard & Poor's/Case-Shiller index of 20 major cities rose 0.5 percent from April, but was still 17.1 percent below May a year ago. Thirteen cities showed monthly increases, with the best results in Cleveland, Dallas and Boston.
The 10-city index rose 0.4 percent from April, but was off 16.8 percent from May last year. It was the fourth consecutive month both indexes showed slowing price declines.
The monthly increases for the national indexes were the first since the summer of 2006, indicating prices are finally stabilizing.
Chicago showed its first monthly increase since September 2006, when it rose from August. Chicago-area prices were down 17.5 percent compared with May 2008, more than the yearly decreases in the two national indexes.
The 20-city index has lost more than 32 percent since its peak three years ago, putting home prices back to mid-2003 levels.
"We likely do have a way to go before we see sustained home price appreciation," said David M. Blitzer, chairman of the S&P index committee.
The Case-Shiller index tracks repeat sales on a specific group of homes in each city. Sales between related parties, such as family members, are excluded.
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