US Home Prices Rise Most Since May 2006: Case-Shiller

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U.S. single-family home prices rose more than expected in February, posting their best annual increase since May 2006 in a fresh sign the housing recovery remains on track, a closely watched survey showed on Tuesday.

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The S&P/Case-Shiller composite index of 20 metropolitan areas gained 1.2 percent on a seasonally adjusted basis compared to January, topping forecasts for 0.9 percent.

"Despite some recent mixed economic reports for March, housing continues to be one of the brighter spots in the economy," David Blitzer, chairman of the index committee at S&P Dow Jones Indices, said in a statement.

Prices in the 20 cities gained 9.3 percent year-over-year, also beating expectations for 9 percent and the biggest increase since May 2006.

On a non-adjusted basis, prices rose 0.3 percent.

"It is very strong, it's a solid rebound, but I would not call it a bubble," said Blitzer about housing on CNBC's "Squawk on the Street."

Still Blitzer said the overall economic picture does not look as strong as housing.

"This is not an all-time boom by any means, there is a lot of hesitancy and there are a lot of foreclosed houses out there so this is not 2006 all over again," he added.

Adjusted prices have been rising since last February, the first year of gains since before the housing market's collapse. The sector started to turn the corner in 2012, helped by tighter inventories and improved sales.