Existing-home prices in the country’s 20 largest metro markets continued to gather steam in June. The monthly Standard and Poor’s/Case-Shiller Home Price Index, which tracks prices in these metro markets, stood at 141.86 in June, 1.39% higher than in May. That was the second monthly gain in a row for the Index, which previously hadn’t increased since July 2006.

The June Index is still 15.4% below June 2008 levels, but that percentage decline is less than in previous months. For the second quarter, the Index was up 2.9%, the first quarterly increase in three years. The S&P/Case-Shiller Index covers all nine Census regions and reflects about 77% of the country’s total housing stock. “We’re back to where we were in 2003,” says Dr. David Blitzer, S&P’s managing director, during a teleconference Tuesday morning.

Detroit and Las Vegas were the only markets of the 20 whose price indices in June were lower than in May. Vegas also had the steepest year-to-year decline, 32.4% to 107.31. Other markets enjoyed noticeable month-to-month jumps in June, including Cleveland (4.2%, to 106.38), San Francisco (3.3%, to 124.70), Minneapolis (3.1%, to 113.48), Dallas (2.7%, to 119.68), and Boston (2.6%, to 152.71).

Whether the June Index will come to be seen as a turning point for the housing industry, though, is still unclear, as price data continue to send out conflicting signals. On Tuesday morning, the Federal Housing Finance Agency (FHFA) reported that U.S. home prices in June rose 0.5%, the second consecutive monthly gain. But FHFA also estimates that prices were down in the second quarter by 0.7% and were off in six of the nine regions and in 38 states that the agency tracks.

During the teleconference this morning, Yale economics professor Robert Shiller said that while the Case-Shiller Index in June represents “a sudden break in the [negative] momentum,” he thinks it’s still too early to predict that house prices are stabilizing. He points to what looked like a price recovery in early 2008 that fizzled as an example of how promising indicators can be deceiving.

The wild card, of course, is what impact foreclosures are likely to have on existing- and new-home prices going forward. A new report by Fitch Ratings observes that a growing number of homeowners who fall behind on their loan payments aren’t catching up. That portion of delinquent loans that returns to current payment status, known as the “cure rate,” has been falling significantly for prime, subprime, and Alt-A borrowers.

Using this data, Barclays Capital is projecting that the number of foreclosed homes for sale will peak at 1.15 million in mid-2010, from about 688,000 as of July 1, according to a report this morning in the Wall Street Journal

“The government has not yet handled the foreclosure problem,” said Shiller. Uncertainty about the foreclosure factor, as well as a 9.4% unemployment rate that is likely to rise, could be why investors are not responding to the current uptick in existing-home prices, observed Shiller.

John Caulfield is a senior editor for BUILDER magazine.

Learn more about markets featured in this article: New York, NY, Las Vegas, NV.