Anthony Sanders, a professor of real estate finance at George Mason University, said there was "definitely a chance" that a double dip could occur in housing, given recent data showing little support for it.
"If interest rates begin to climb, that could be the tipping point for the double dip," Sanders said.
Noted Joel L. Naroff, of Naroff Economic Advisors in Holland, Bucks County: "If you were hoping to rebuild your home equity quickly, forget it. Foreclosures will continue to pressure the market for a long time."
Although the news was daunting, Patrick Newport, a housing economist at IHS Global Insight, said that "the indices in most cities appear to be coasting toward a bottom. He added that prices are recovering in a few places, including San Francisco, Washington, and San Diego, after hitting a cyclical low.
After days of reports showing sales of previously owned and new homes fell to record lows in February, with prices following suit, the Case-Shiller data were less than encouraging for a recovery.
Continued weak demand and a glut of homes for sale "should translate into at least another 5 percent" decline in prices, Newport said.
A Federal Deposit Insurance Corp. proposal Tuesday that banks keep some risk on mortgage-backed securities might make home loans harder to obtain by increasing the size of down payments, further weakening demand.
Housing and Urban Development Secretary Shaun Donovan defended the rule, saying options of 10 percent and 20 percent down would be available. But the National Association of Home Builders and others countered that the rule "would disrupt the housing market and undermine an already-fragile recovery."
