Case-Shiller shows home prices rise sharply again (by Jeffry Bartash)

WASHINGTON (MarketWatch) - U.S. home prices rose in July for the fourth straight month to reach their highest level in nearly two years, according to an index released Tuesday. The S&P/Case-Shiller 20-city composite posted a 1.6% increase in July in the wake of a 2.3% advance in June. And home prices are now up 1.2% compared to one year earlier. For the third month in a row, all 20 cities in the index recorded prices increases. The rise in home prices reflects increasing demand for new and pre-owned homes following the real-estate market's worse slump in modern times. "The news on home prices in this report confirm recent good news about housing. Single family housing starts are well ahead of last year's pace, existing home sales are up, the inventory of homes for sale is down and foreclosure activity is slowing," said David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices. "All in all, we are more optimistic about housing." Despite the recent increase in prices, homes still sell for about 30% less compared to the market's 2006 peak.