A key measure of US house prices is at the highest level since the eve of the last crash

The S&P Case-Shiller index of US home prices rose in September to the highest level since July 2006, when the most recent housing boom topped out.

A report Tuesday showed that the national index rose by 5.5% year-on-year in September. The 20-city composite, which covers major metros, rose by 5.1%, unchanged from the previous month.

Seattle recorded the highest year-on-year price increase, by 11%, followed by Portland and Denver.

House prices have been rising as a healthy jobs market and historically low mortgage rates made homeownership more appealing. Also, constrained supply helped to bid up the prices of existing homes, especially in desirable East and West Coast cities.

“The new peak set by the S&P Case-Shiller CoreLogic National Index will be seen as marking a shift from the housing recovery to the hoped-for start of a new advance,” said David Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices, in the release.

“While seven of the 20 cities previously reached new post-recession peaks, those that experienced the biggest booms — Miami, Tampa, Phoenix and Las Vegas — remain well below their all-time highs.”

He said other housing indicators such as sales of new and existing homes are performing at the best levels since the recession. That allays concerns of an imminent housing crash, even though prices are as lofty as they were the last time one happened.

“Home prices reaching their nominal pre-recession peaks brings mixed news for the housing market,” said Ralph McLaughlin, Trulia’s chief economist. “It’s good news for homeowners who are no longer underwater, but not so great news for homebuyers who have seen prices outpace incomes for most of the housing market recovery.”

This chart shows that average home prices in the 10- and 20-city composite indexes that S&P created are back to the highest levels since the housing bust.

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