Home prices grew for the third straight month in April, potentially cementing a recovery in values and reflecting a housing market that is sorely undersupplied.

The S&P CoreLogic Case-Shiller US National Home price index increased by 0.5% in April on a seasonally adjusted basis compared with the previous month, according to data released Tuesday. The index that tracks housing prices in the 20 biggest metros showed prices in April rose 0.9% on a seasonally adjusted basis over March, better than the 0.35% gain expected by economists surveyed by Bloomberg.

Similarly, the Federal Housing Finance Agency reported Tuesday that average US home prices grew 0.7% month over month in April on a seasonally adjusted basis.

“The U.S. housing market continued to strengthen in April 2023,” said Craig J. Lazzara, managing director at S&P DJI, said in a press statement. “Home prices peaked in June 2022, declined until January 2023, and then began to recover.”

The monthly gain in prices further challenges buyers who must either bid up the few options on the resale market or turn to higher-priced new builds. But homeowners are able to recoup some of their recent equity losses.

"On a month-over-month basis, house prices have been re-accelerating for the past three months," Mark Fleming, First American's chief economist, told Yahoo Finance. "This is good news for homeowners gaining more equity, but it will pressure affordability for the potential first-time homebuyer."

Year over year, though, the S&P CoreLogic Case-Shiller national index recorded a 0.2% annual decline in April — the first time since April 2012 — while the 20-city index registered a 1.7% decline, again better than the 2.6% drop economists expected.

The index uses the repeat sales method to measure home price growth. This method tracks data on properties that have sold at least twice to more accurately calculate the change in each home's value.