(NEW YORK) -- For the first time since the housing bust five years ago, prices in two U.S. cities have recovered all of their losses -- and then some.
"Denver and Dallas are back up to their peak levels," says Craig Lazarra of Standard & Poor’s.
The firm's Case-Shiller 20-city home price index for May rose 12.2 percent compared with the year before -- the biggest price jump since the spring of 2006.
"The hottest markets were San Francisco, Las Vegas -- they were almost tied -- Phoenix after that, L.A. was also a very strong market," Lazarra told ABC News.
Average monthly prices rose 2.4 percent in May from April. Increases were widespread, with all 20 cities showing gains in May from April and compared with a year ago.
Few housing experts believe the recent price rises will continue at this pace.
"Three straight months of national home value appreciation above 10 percent is not normal," says Zillow Senior Economist Svenja Gudell. "As the overall housing market continues to improve, the impact of foreclosure re-sales on the Case-Shiller indices continues to be pronounced."
Despite the recent price rises, both new and existing home sales are well below normal.
"The real issue in my opinion is that there's a lack of inventory out there in many U.S. markets," Kathy Fettke, CEO of Real Wealth Network, tells ABC News.
The share of cash sales is still well above normal.
"A lot of the sales are being driven by investors not your traditional move-up trade-up buyers or first time homebuyers," says economist Sam Khater of CoreLogic.
Speculators, who are often criticized for their activities, played a key role in the housing recovery in many markets, especially where prices had declined the most in the housing bust.
"They really helped stabilize the housing market in 2010 and 2011," says Khater.
So what's ahead for the housing market? Experts are divided.
"A combination of rising mortgage interest rates, flagging investor demand and more inventory entering the market will all help to moderate the pace of home value appreciation and stabilize the market, ” says Gudell.
But Khater believes the decline in re-financing will lead to more mortgage lending by banks, which could lead to more competition for homes among buyers. "With rates going up and re-fis going down the lenders have to look to the purchase market for business," he says.
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