Are Home Prices Headed for a Double Dip?

Just as home prices appear to be stabilizing, we may be falling into what economists call a "double dip." In other words, after climbing back from the near death spiral of the last few years, yet another round of housing pain may be on its way.

U.S. housing prices have plummeted a jaw-dropping 32.6 percent from their peak in 2006, based on sales in the 20 metropolitan areas tracked by the influential Case-Shiller index. That means residential real estate values are back to where they were in the summer of 2003. Nearly 1 in 4 homes in the country is underwater, owing more on its mortgage than the home is worth, according to First American CoreLogic.

In recent months, the housing market appeared to gain steam. Unfortunately, prices dropped another 0.6 percent from December 2009 to January 2010, according to the Federal Housing Finance Agency (FHFA). And just last week, economist Paul Dales reported that increases in excess housing supply are beginning to tamp down any upward price momentum.

But good luck getting a consensus on where home prices are headed. Aiming to gain a broader perspective, HousingWatch decided to conduct its own informal poll of economists. Experts Barry Ritholtz, David Crowe, and Mark Thoma graciously offered their own divergent opinions on whether the residential real estate market is due for a double dip. Their edited answers follow: