Seasonally adjusted gains indicate fragile housing bottom, economist says

While home prices may currently be on their way up, prices will continue to fall year-over-year into 2010, Diane Swonk, chief economist of Mesirow Financial told CNBC. Swonk said that while we are seeing a bottom, it is a very fragile one. Since the year-over-year indexes continue to fall, she said it is important to compare market to market and compare seasonally adjusted rates to non-seasonally adjusted rates. “Home prices always rise in the spring and summer months when families looking to move before the start of the school year dominate the more expensive market,” said CNBC’s Diana Olick. Also, she said the first-time homebuyer tax credit has added 350,000 new buyers who bolstered the market over the spring and summer months. “If you seasonally adjust the monthly gains, some are actually half of what the raw numbers show,” Olick said.