NEW YORK (CBS 2) — News that housing sales have taken a significant hit has many talking about a double dip recession.
Two recent reports that say sales of new and existing homes have taken a dramatic hit coupled with high unemployment has many concerned that the worst is yet to come.
“I’m very worried,” Emily Stewart told CBS 2’s Kirsten Cole, “I’m currently looking for employment, I mean how much more can we stand… it’s just been really rough.”
While a number of financial institutions said the possibility of a double dip recession is somewhere between 25 and 33 percent, some housing analysts disputed that notion.
Jonathan Miller says the 27 percent drop in sales is the inevitable fallout from Americans rushing to buy homes before the $8,000 stimulus program closed at the end of April.
“What we’re seeing now is a sort of hysteria…the reality is the tax credit created this environment,” Miller said.
And the low home sales numbers will continue according to Miller.
“The next 60-90 days we’re going to see very low sales activity,” Miller said.
There are several indicators that leave open the possibility of a second recession.
Professor Laura Gonzalez of Fordham University points to unemployment staying at high levels, problems in corporate America that hinder employee productivity and said governments need to correct banks being reluctant to lend.
“Force the banks… not only to repay what they borrowed, but to start giving credit out,” Gonzalez said.
While economists said individuals can’t do anything to effect the larger economic conditions, people could do things within their lives to take more control.
Gonzalez also offered the following advice to people during the current economic conditions:
-Be willing to move to get a job.
-Invest in a home only if you can stay in it for 5-10 years.
-Strike a good balance between spending and saving.