For the fourth month in a row, Case-Shiller prices have outpaced Econoday's consensus, up 1.0 percent in May on the adjusted 20-city resale index versus expectations for 0.8 percent. Year-over-year change is a second month of 1.7 percent contraction.

Turning back to the monthly rate, the report notes that January this year looks to be the final month of decline for this index which began to fall in June last year when mortgage rates started to climb. The report reads that"the breadth and strength of May's report are consistent with an optimistic view of future months."

Phoenix, down 0.1 percent, was the only one of the 20 cities not rising on the month. On a yearly basis, Chicago, Cleveland, and New York lead with low mid-single digit gains in what the report describes as the"revenge of the rust belt".

Case-Shiller's report gives a lift to Econdoay's Consensus Divergence Index which is at plus 7 to indicate that US results in sum are coming in on the high side of consensus.

Forecasters see the adjusted 20-city monthly rate rising a sharp 0.8 percent in May versus April's 0.9 percent increase. Yet the unadjusted annual rate is expected to remain in contraction at minus 2.5 percent after a contraction of minus 1.7 percent in April. Case-Shiller prices have beaten expectations the last three months in a row.

The S&P Corelogic Case-Shiller home price index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the nation. Composite indexes and regional indexes measure changes in existing home prices and are based on single-family home resales. Condominiums and co-ops are excluded as is new construction. Note that forecasters, in line with recommendations from Standard & Poor's questioning the accuracy of seasonal adjustments, track both seasonally adjusted and not seasonally adjusted monthly data for this indicator.

Home values affect much in the economy - especially the housing and consumer sectors. Periods of rising home values encourage new construction while periods of soft home prices can dampen housing starts. Changes in home values, and the ability to draw upon expanding lines of home equity loans, play key roles in consumer spending and in consumer financial health.

Beginning with the onset of the subprime credit crunch in mid-2007 and with it a downturn in home prices, the ability of borrowers to refinance their debt into affordable fixed rate mortgages was sharply constrained. This in turn limited aggregate consumer spending and contributed to the depth of the Great Recession. From their peak in late 2006 and early 2007 to their nadir in mid-2012, Case-Shiller's home price indexes fell nearly 50 percent. The subsequent recovery proved slow but steady with the indexes finally surpassing their prior highs in early 2018.