Interest rates may be very attractive, but by other measures credit is not "easy." People with strong credit scores and money for a 10 percent down payment can get loans, but bank standards for mortgages still haven't eased up in response to an improving economy.
It's not hard to see why banks are wary, given the uncertainty about home prices and the high rates of default on loans issued before 2009. But some economists say the pendulum has swung too far from loose to tight.
"We believe home sales could actually be 15 percent higher than what we have recently experienced," if credit conditions were more normal, says Yun of the NAR.
If lending conditions improve, that could increase demand for homes even if interest rates are rising.
