The huge impact of the federal home buyer tax credit program, which is now set to continue and even expand through next spring, dominates the housing resale numbers this week.

Sales of existing houses during the third quarter jumped by 11.4 percent over second quarter sales, according to the National Association of Realtors.

And the increase in sales came in pretty much every part of the country -- in 45 states along with the District of Columbia.

Check out some of these extraordinary increases -- all tied in part to home buyers rushing to complete purchase transactions before the tax credit's original expiration date of November 30th, plus mortgages at rock bottom five percent rates or less.

In North Dakota, sales were up 42.4 percent, Rhode Island 27 percent, Pennsylvania 26 percent.

In some hard hit local markets, sales gains were almost off the charts. In Orlando, they were up 80 percent for the quarter. In Las Vegas sales were 30 percent higher this year over last.

So do you think things are stirring out there? You bet they are, and economists haven't yet even begun to assess the potential effects on future sales flowing from the brand new $6,500 tax credit for "repeat" buyers.

That means people who've owned their house for a consecutive five of the previous eight years, and now want to downsize, move up or just move to a different location.

That credit, which took effect November 6th, will be available for home purchase contracts signed by April 30th of next year and closed by June 30th.

Of course, not all of the developments underway in the economy right now are favorable to housing and real estate.

Start with the unemployment rate, which just jumped to 10.2 percent, the highest in decades. Most economists agree that the true jobless rate, factoring in people who've stopped looking for jobs and those working part time, takes the effective unemployment rate nationally closer to 18 percent.

That's a major negative for home buying prospects.

And the flip side of record housing sales numbers can't be ignored either: Prices are still way down from year ago levels in many areas -- and they're down 11 percent during the third quarter compared with 2008.

So that's all pretty sobering.

Nonetheless the fact is that the only way we're going to move towards full recovery is by selling a lot of houses, at very attractive prices and low interest rates.

That's happening right now in a big way -- and it looks like it should continue well into the spring.

Published: November 17, 2009

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Kenneth R. Harney writes an award-winning, nationally-syndicated column on housing and real estate from Washington, D.C. He is also managing director of the National Real Estate Development Center, a professional education company. He is a past member of the Federal Reserve Board's Consumer Advisory Council, a committee that by federal statute reviews all Fed actions on home mortgage, consumer credit and banking industry regulation. He served as a member of the U.S. Department of Housing and Urban Development's Working Group on Computerized Loan Origination (CLO) systems, and is a member of the Editorial Board of the Fannie Mae Foundation's journal, Housing Policy Debate. He is the author of two books on mortgage finance and real estate.