U.S. home prices in February posted their first annual increase in more than three years, although it is too early to say the battered housing market is recovering, according to a private report released Tuesday. Despite the 0.6 percent increase in home values, 11 of the 20 cities in the Standard & Poor's/Case-Shiller home-price index showed declines. The last time home prices rose on a year-over-year basis was December 2006. Home prices are up more than 3 percent from the low hit in May 2009, but they are still 30 percent below the May 2006 peak. "These data point to a risk that home prices could decline further before experiencing any sustained gains," David Blitzer, the chairman of the S&P index committee, said in a statement. A recovery in home prices is considered necessary to improve consumer optimism and help revive the broader economy. A home is the biggest and most important financial asset for most people, so as values climb, homeowners feel wealthier and more comfortable spending, which accounts for two-thirds of economic activity.
