Home Prices Notch Best Gain in Two Years, Rising 4.3% in October on Improving Sentiment

December 26, 2012 10:26 AM EST
Home prices rose by the most in over two years as sentiment in the real estate market and U.S. economic firmed-up during the month,

According to data out Wednesday, the S&P/Case-Shiller 20-city index rose 4.3 percent year-over-year in October, the largest 12-month gain since May 2010. The Street was looking for a more modest 3.9 percent rise.

The S&P/Case-Shiller index utilizes three-month data, meaning August and September were factored in as well.

Seasonally-adjusted home prices rose 0.7 percent in October. Las Vegas showed a 2.4 percent gain, leading the 20-city index, while Chicago fell 0.7 percent and was the overall laggard.

David Blitzer, chairman of the S&P/Case-Shiller index committee, said, "It is clear that the housing recovery is gathering strength...Higher year-over-year price gains plus strong performances in the southwest and California, regions that suffered during the housing bust, confirm that housing is now contributing to the economy."

Lawmakers will be getting back to work on solutions to the fiscal cliff following the holiday break. It was reported earlier today the President Obama and House Speaker Boehner didn't communicate over the weekend. About $600 billion of spending cuts and tax hikes will take place if no solution is agreed upon by the end of December.

U.S. markets are largely mixed today, with the S&P 500 and Nasdaq lower and Dow Jones slightly positive.

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