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This year, housing has been one of the bright spots in the economy. A recent report showed home prices in the top 20 cities continued to climb in August, and there are far fewer foreclosure sales and other signs of distress in the market. But there are still signs of weakness. The Federal Reserve expressed concern yesterday that the housing market is slowing and pending home sales fell far more than expected.

As NPR's Yuki Noguchi reports, housing experts are bracing for volatility.

YUKI NOGUCHI, BYLINE: It's not as though this has been a normal summer or fall. First, there was talk of the Federal Reserve tapering its stimulus, which drove interest rates up. Then came the government shutdown and the political brinksmanship over whether the U.S. would default on its obligations. And more recently, with a decision about tapering and a fight over the nation's debt ceiling put off for at least several weeks, interest rates declined.

Glenn Kelman, the CEO of the real estate website Redfin, argues that all that drama has made an impact on homebuying patterns.

GLENN KELMAN: Consumers are on a hair trigger. It's not as if this market is so strong that they're not going to be shaken by European debt crises or American fiscal crises. The buyers that we talk to seem to read the papers. And one week they're hot, and the next week they're cold.

NOGUCHI: Lawrence Yun is chief economist for the National Association of Realtors.

LAWRENCE YUN: The housing market is beginning to soften.

NOGUCHI: He says fewer buyers are even touring homes and he says that's mostly because homes are nearly 13 percent more expensive than last year. They're more expensive for some healthy reasons and some unhealthy ones. The healthy one is that there are fewer cheap, distressed homes available as the market works through the remnants of the financial crisis.

But Yun says home prices are also rising quickly because there's not enough inventory.

YUN: Buyers are saying things are becoming more expensive. We are seeing some natural adjustment in the process. What I would like to actually see more is more inventory coming onto the market from aggressive homebuilding, but that's not happening.

NOGUCHI: It's not happening because small builders say they can't get construction loans from banks. And counter-intuitively, there's a shortage of skilled labor in that sector.

YUN: Interestingly, even with high unemployment, the builders are saying that there's difficulty finding construction workers.

NOGUCHI: Redfin's Glenn Kelman agrees that inventory is the big question for next year, and will determine whether housing remains an economic driver. He notes how Wall Street investors snapped up many homes and turned them into rentals in recent years.

KELMAN: And so the question next year is whether more sellers are going to come into the market. If you really want to see real estate drive more of the U.S. economy, you need more sales volume.

NOGUCHI: But overall, Kelman argues there's been a sea change in how people think about investing in homes.

KELMAN: The real estate market has been volatile and I would say that's the fundamental change between this market and the market we've had for the past 50 years. It used to be that real estate was a very stable investment. The middle class was very comfortable making it. Stocks were where all the volatility was. And now I think real estate has become just as speculative as any other class of investment.

NOGUCHI: In other words, it's harder than ever to know when is a good time to buy. Yuki Noguchi, NPR News, Washington.

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