Time for a Turnaround?

>> Good news for the battered housing market for the first time in nearly three years housing prices rose during the month of May. Joining us now is Jill Schlesinger, Editor at Large for cbsmoneywatch.com. We're all kind of doing one of these cartoon double takes. Did we really see this? I showed the cover of the Wall Street Journal this morning. What's the big picture look like across the country?

>> Jill: Housing prices are down 17% from a year ago so that's when people are going to say, "What?" But they're up one-half percent in the last month; the first time we've seen a nice increase and in three quarters of the surveyed cities, we saw prices either stable or up; that was a turning point in this particular survey.

>> Everybody's been talking--the cover of Newsweek says the recession is over; this country is scrapping along the bottom. Does this means maybe the economy is starting to just get off the bottom a bit?

>> Jill: Well absolutely because when you think about it, housing brought into this crisis; so the first signs of stabilization are seen as a very good big picture indicator. This doesn't mean happy times are here again but it does mean that we are in a better place.

>> Let's look at some of these markets, housing prices, where the arrows are green and it's kind of amazing having gone through this for the last several years now.

>> Jill: Well I want to move to Cleveland obviously. The prices are up 4% and one might, "Okay so here's the deal, in most cities we had some good progress. The places where we didn't--those Sunbelt cities like Phoenix and Las Vegas, are still under tremendous, tremendous pressure.

>> Yeah okay assume for a moment that the recession has hit straight through the bottom and we're beginning to come out of it. What are things that we need to be mindful of as this starts to happen? We, right now as we stand here this second?

>> Jill: Okay. Right now what you have to think about is when a recession ends; the Federal Reserve is going to start to raise interest rates. They want to prevent inflation. Don't be freaked out if you start to see rates go up. However, that means today's locking in fixed rates, paying off your credit card rate as quickly as possible, or any adjustable rate loans so interest rates will be a big picture item for us in the recovery.

>> All right one of the other things that doesn't seem to be going away in all of this is the unemployment keeps on going up, the economy is still hemorrhaging hundreds of thousands of jobs; if you've got a job what do you need to keep in mind?

>> Jill: Well first of all, job loss is tapering off but don't get too cocky in your current job because employers are still very quick to lop off anyone they don't think is productive. But what you should do is adjust to the current wage you are earning because we will not see wage increases anytime soon. Wages are stagnant; they are expected to remain stagnant probably for another year or so.

>> All right some good advice as the kind of--I'm not exactly feeling like I'm hanging on to a balloon.

>> Jill: We're limping to the finished line.

>> There you go. Jill Schlesinger as always, thanks.

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