The Standard & Poor’s/Case-Shiller index for August showed that home values in 20 cities rose 2 percent compared with August 2011. (Molly Riley/Reuters)

The housing market’s recovery appeared to receive a boost Tuesday following the release of a popular real estate measure. However, economists cautioned against getting carried away by the optimistic report.

The Standard & Poor’s/Case-Shiller index for August showed that home values in 20 cities rose 2 percent compared with August 2011, which was the largest year-over-year gain since July 2010 and the third consecutive year-over-year gain.

Meanwhile, average home prices were up only 0.9 percent in August from July. Still, it was the fifth consecutive month-over-month gain. All of the 20 cities in the index with the exception of Seattle posted gains. Seattle’s prices declined 0.1 percent.

“The sustained good news in home prices over the past five months makes us optimistic for continued recovery in the housing market,” David M. Blitzer, chairman of the S&P Dow Jones Indices index committee said in a statement.

Average home prices as measured in the 10-city and 20-city composites are back to their summer/autumn 2003 level, according to the report. Compared to their June/July 2006 peaks, both composites have declined about 30 percent through August 2012. The August levels for both composites are about 8.5 percent above their lows earlier this year.

The data in the Case-Shiller index, which gauges prices compared to what they were in January 2000 and calculates a three-month average, tend to lag behind other measures in the housing market. Also, the August numbers, which are the latest available, are not seasonally adjusted. Therefore, the gains could be more a reflection of the summer buying season.

Economist Stan Humphries of the real estate Web site Zillow warned that Case-Shiller is mimicking what other housing indicators already have shown, that the housing market has hit bottom but these modest gains could be short lived.

“The reality is that the annual comparison for Case-Shiller is a bit of a mirage since home values were down so sharply in the back half of 2011,” he said. “On a monthly basis, Case-Shiller will likely be flat or even slightly down from now until year end. Be prepared that Case-Shiller will likely report some negative monthly trends by year’s end, but this doesn’t mean the housing recovery has been derailed. This is exactly what bouncing along the bottom looks like.”

Economist Jed Kolko of the real estate Web site Trulia said the year-over-year gain is better than it sounds.

“The Case-Shiller headline numbers – the 20-city composite – has been understating year-over-year national price growth,” he said. “The 10-city and 20-city composite indexes are heavily weighted toward New York and Los Angeles, and New York had the second-biggest price decline year-over-year after Atlanta, which drags down the composite indexes relative to the national index. That means year-over-year national price growth in August could be between a half and full percentage point higher than the 20-city composite year-over-year growth of 2.0 percent reported today.

“The month-over-month gain is worse than it sounds because the Case-Shiller headline numbers are not seasonally adjusted. Almost half of the 0.9 percent month-over-month gain is due to seasonal factors, which are typically most favorable in the August and September releases. Seasonally adjusted, prices rose 0.5 percent month-over-month for the 20-city composite.”

Steady price increases would help the housing market rebound more quickly by encouraging more people to sell their homes. Low inventory continues to thwart the recovery in the Washington region because many people still have negative equity and can’t afford to sell. Rising prices would likely bring more homes onto the market and provide more opportunities for first-time home buyers to purchase a home.