I'm really pleased lately. Flurpee (the recently turned 7 year-old) has started really reading. She no longer sounds out three letter words or forgets what the vowel sounds are. A page that used to take 15 minutes to read now only takes three. On her own initiative she's begun reading her the instructions from her math and spelling books on her own. Her reading level has just jumped recently.
In a way it seems as though she went from not reading to reading over night. I know that's not true, but it's easy for me to forget all of the work she and I have both done. In the beginning of this year, she would still sound out each letter even in short words. We practiced with Bob books (which I loved and that she would read without hassle for her Montessori teachers), but she felt they were too baby-ish. We moved onto Magic Tree House books, but I had to tell her half of the words because they followed phonics rules she hadn't learned yet. Along with reading from the book, we also practiced using the Phonics Pathways book.
Her comfort and confidence went way up when we began practicing more consistently (helping that automaticity along) and as she got further and further into the Phonics Pathways book. We reviewed previously introduced word lists (word lists showing a specific sound in a lot of words--like 'ou' in pounce, bounce, ounce) at least five times and introduce a new sound combination every-other day. We had already worked on sight words--real sight words, not the Dolche sight word list whose words often follow phonetic rules. When she's reading a word that is not familiar or a sight or irregular word that she is having trouble with, I jump in and tell her how it's pronounced. She can pronounce 80% of the words on her own. Now she can read a page in the Magic Tree House books in a few minutes, instead of the 15 it used to take.