As we have been discussing for a while now, home sales are likely to be quite weak following the expiration of the home buyer tax credit. "How weak?" you might ask? Well, let's just say they could be the lowest in any relevant time span. The expectation of economists is probably way off this time as is being discussed over on Calculated Risk.
If these sorts of sales rates are maintained (if that is the proper word to use here) prices will certainly decline again, which has been our expectation here. What that means is that even now might not have been the best time to buy a house as you will not be building up equity. Of course, it depends on the market, but most will be quite weak.
Now, as for whether or not this will push us into another recession, I don't think so. Existing home sales, which are the bulk of home sales, really aren't that economically productive as they don't reflect the production of new goods. New home sales are really about as low as they can go and were probably actually depressed by the credit pushing more people into existing homes. A decline in prices may make banks a little more skittish, though it would be hard to see how they could be more tight-fisted than they are now.Any source
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