The number of real estate markets that are considered “improving” by the National Association of Home Builders reached 263 in June — a gain of five from the previous month.

The figures come from the NAHB-First American Improving Markets Index, which gauges metro areas’ health regarding home prices, employment and construction permits for the last six months. June saw 29 markets added to the list. Twenty-four cities dropped off the list.

"This is the fifth consecutive month in which the IMI has designated more than 70 percent of U.S. metros as improving," said NAHB Chairman Rick Judson, a home builder from Charlotte, N.C. "While that's a good sign that the housing recovery is on solid footing, we know that various challenges are slowing its progress - including continuing issues with credit availability for builders and buyers, as well as appraisals that aren't keeping up with the rising cost of construction."

New cities on the list include Chicago; Topeka, Kan.; and Baton Rouge, La.

Even though a number of cities fell off the list, the overall housing market is still showing positive trends, officials said.

"As market conditions improve across most of the country, some metros have moved onto the IMI list while marginal seasonal fluctuations have nudged others off of it,” said David Crowe, the NAHB’s chief economist. "This is to be expected as the recovery expands. Meanwhile, it's worth noting that the number of improving markets is now more than three times what it was in June 2012."