The housing market is starting to pick up speed again.
New reports released on Tuesday show home prices rose for the sixth month straight. In July, the prices rose while home resales and groundbreakings on new properties increased in August.
Economists believe that the housing market is showing promise after experiencing a major collapse six years ago.
The S&P/Case Shiller composite index, which is used to measure the U.S. housing market in 20 metropolitan cities, reported that prices rose 0.4 percent on a seasonally adjusted basis. Economists expected a 0.9 percent rise which would have matched the progress that occurred in June.
When compared to last year’s statistics, housing prices have risen 1.2 percent.
“Even with the broader economic recovery struggling to gain traction, the housing recovery is sustainable," wrote Paul Diggle, property economist at Capital Economics.
While the housing market provides an optimistic view, experts say the economy still has a long way to go in the upcoming quarters.
“We [did] not previously have a decline in house prices since the 1940s so we don't know for sure, but six months of price rises may deter people from renting," said Larry Kantor, head of research at Barclays Capital.
To battle some of the housing woes, the federal government recently released a new initiative to purchase $40 billion of mortgage-backed securities until the job market progresses.
According to Freddie Mac, the federal government has also pushed mortgage rates to record lows.
However, challenges still lie ahead with tight lending restrictions, large numbers of underwater homeowners, and large quantities of foreclosures still looming.