The government is doing its part to keep a prop under housing by extending the home buyer credit into 2010 and expanding it to include qualifying existing homeowners. But here's the potential show-stopper to a housing recovery: Rising mortgage rates.

Indeed, the rate on a 30-year fixed-rate home loan rose above now-psychologically important 5% level last week. The rate has been below that for two months. The Associated Press reports that the increase has already caused a drop in new-home mortgage and refinancing applications.

Of course, policymakers and economists are keen to see housing sustain at least a very modest recovery in 2010. An improved economy might help that process, and housing prices could bottom early next year. The headwinds that could keep the market in trouble, however, are the huge number of "interest only" mortgages that will reset, causing higher monthly payments, and the ongoing rise in foreclosures (exacerbated by those resetting mortgages).