Housing: It's not a double dip, but a 'catfish recovery'

This week brought us the sobering news that housing prices had hit new lows and a prediction that home prices will "continue on their downward spiral with no relief in sight."

Scott Sambucci of Altos Research begs to disagree. What we're seeing is not a "double dip," he says, but a "catfish recovery" –  normal volatility.

• Pain of real-estate bust spreading to more cities

You know how catfish swim along the bottom of the river, then surface to eat, then go back down and swim along the bottom, then …?

Expect the housing market to do the same, with no consistent trend up or down.

"The notion that the housing market would hit bottom and head back up consistently is simply ignoring history," Sambucci said in a webinar, as quoted by Housing Wire. "There's plenty of proof and plenty of historical data that shows continued volatility for a long period of time."

Sambucci "respectfully disagrees" with the pessimistic conclusions of David M. Blitzer of S&P/Case-Shiller. The S&P/Case Shiller indexes, which track 20 large cities, found that housing prices nationwide dropped 4.2% in the first quarter of 2011.

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Sambucci argues that those are old numbers and that his company's data from April through June find prices rising slightly in 18 of the 20 cities tracked by Altos. The exceptions are New York and Las Vegas.

• Pending home sales drop 11.6%

Altos tracks prices in some smaller metropolitan areas rather than only in the larger, mostly coastal cities tracked by Case-Shiller.

CoreLogic also found a slight increase in prices, 0.7%, from March to April.

When looking at all these indexes, it's important to take into account that they're looking at median and average prices, and trends vary not only by city but by neighborhood. The percentage of distressed-home sales used in the analysis also affects prices, as does the percentage of lower-priced versus higher-priced home sales during the period measured.

• Prediction: 3 times more investors than owner-occupants

"Plan for prices over the long term to hit a bottom, rise a bit, sink back down, rise again -- a pattern we expect with the housing market for several years," Sambucci said. "The housing recovery will take a long time and it is going to happen slowly."