Top 10 cities where home prices are on the rise

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Home prices rose 3.9 percent from April to May in San Francisco, the biggest jump of any major metro area.

The real estate market continues to be a drag on the economy, but the latest S&P/Case-Shiller Home Price Index should give homeowners a little hope. Data through May 2012 – the last month available – shows homes prices increased by 2.2 percent from April to May in both the 10- and 20-city composites covered in the report.

Annually, home prices nationwide held relatively steady, falling only 1 percent in the 10-city composite and 0.7 percent in the 20-city composite.

“With May’s data, we saw a continuing trend of rising home prices for the spring,” said David M. Blitzer, Chairman of the Index Committee at S&P Dow Jones Indices, in a press release. “On a monthly basis, all 20 cities and both composites posted positive returns, and 17 of those cities saw those rates of change increase compared to what was observed for April.”

Blitzer is optimistic about the future of the housing market but remains cautious, since spring and early summer are seasonally strong buying months. “The housing market seems to be stabilizing, but we are definitely in a wait-and-see mode for the next few months.”

Though all 20 metropolitan statistical areas covered in the study posted positive monthly returns in May, some markets are doing better than others. These 10 metro areas saw home prices rise in both April and May, and also showed relatively strong annual returns in May.

Median home sales prices courtesy Trulia.com.

10. Miami
April to May price increase: 1.4 percent
Median home price: $160,000

Miami saw home prices increase 3.4 percent annually in May. This exciting metro is home to beautiful beaches and Everglades National Park, and the cultures are vibrant and varied. With all that the city and its surrounding area have to offer, it’s no wonder home prices are on the rise in Miami.

9. Dallas
April to May price increase: 1.9 percent
Median home price: $63,725

Home prices in Dallas increased annually by 3.8 percent in May, and posted good month-over-month returns in the previous month as well. The city has more to offer than Cowboys: It’s home to cultural attractions like the Dallas Symphony Orchestra, the Public Art Walk and the Meadows Museum, which hosts the most comprehensive selection of Spanish art outside of Spain.

8. Tampa, Florida
April to May price increase: 2.0 percent
Median home price: $114,340

In addition to its relatively strong monthly increases in April and May, prices rose on an annual basis by 2.5 percent. Tampa is less flashy than Miami and not as crowded as Orlando, but residents have plenty to keep them busy. Miles of beachfront, great museums and restaurants and the always popular Busch Gardens attract homeowners from all over the country.

7. Denver
April to May price increase: 2.1 percent
Median home price: $227,500

Prices increased annually by 3.7 percent in May, and it’s easy to see why. According to recent reports from Metro Denver, the Denver economy is steadily growing. And where there are jobs, there are people who want them. Denver is also a great place to live, especially if you love outdoor activities. You’re just a short jaunt from the foothills of the Rockies, which are perfect for hiking, biking, camping and more.

6. Washington, D.C.
April to May price increase: 2.5 percent
Median home price: $437,500

Home prices are high in Washington, and they’re continuing to climb. Home prices rose 2.8 percent year-over-year in May, in addition to month-over-month increases in the month previous. Washington’s economy is steady, due in large part to the number of people who work for the federal government. The private sector is robust, too, and average salaries are higher here than in much of the country.

5. Portland, Oregon
April to May price increase: 2.6 percent
Median home price: $265,000

Prices in Portland are on the rise. The average home price showed a slight annual increase in May, edging upward by 0.4 percent. Month-over-month numbers climbed two months in a row as Portland gained popularity with homeowners. The quirky northwestern city is well-loved among foodies, and both artist and outdoorsy types enjoy all the city has to offer.

4. Seattle
April to May price increase: 2.6 percent
Median home price: $385,000

Seattle and Portland boasted the same month-over-month home price increase, but Seattle’s year-over-year numbers were slightly better. Annually, home prices increased 0.6 percent in Seattle as more homeowners settled down to enjoy this fantastic city. From whale watching in Puget Sound to climbing Mount Rainier, there’s something for everyone in Seattle.

3. Phoenix
April to May price increase: 2.7 percent
Median home price: $114,950

This Arizona metropolis saw the largest annual increase in home prices, which jumped more than 11 percent from the previous year in May. Home prices took a beating when the housing market collapsed, which contributes to the huge rises we’re seeing now. But that’s not all – the affordable housing prices and warm winters likely help influence homeowners to call Phoenix home.

2. Minneapolis
April to May price increase: 3.1 percent
Median home price: $168,062

Home prices in Minneapolis increased 4.7 percent on a year-over-year basis, and boasted impressive monthly numbers in both April and May. This half of the Twin Cities offers the convenience of a big city and the charm of a small town. There are fantastic restaurants, loads of cultural attractions and, best of all, tax-free shopping that will save homeowners hundreds of dollars a year on personal items.

1. San Francisco
April to May price increase: 3.9 percent
Median home price: $705,000

San Francisco saw an annual rise in home prices of only 0.6 percent in May, but also boasts the highest median home price on this list. The city is split into a number of different neighborhoods, each one more vibrant and eclectic than the next. From the famous “Painted Ladies” that line the streets to world-class dining and nightlife, San Francisco has something for any homeowner who has money to burn.

Ilyce Glink is an award-winning, nationally syndicated real estate columnist, blogger and radio talk show host, and managing editor of the Equifax Finance Blog. Follow her on Twitter @Glink.

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