Former Federal Reserve Chairman Alan Greenspan is saying that the U.S. unemployment rate is going to break the 10 percent mark before long and hover there for awhile before the trend reverses.

Speaking with George Stephanopoulos Sunday on ABC’s “This Week,” Greenspan said

“…At some point, we’re going to start to see an improvement in employment, but remember that unless there is a monthly increase of more than 100,000 a month, you’ve still got the unemployment rate continuing to rise.”

“My own suspicion is that we’re going to penetrate the 10 percent barrier and stay there for a while before we start down,” he said.

His predictions are not all that shocking considering the Labor Department announced on Friday that the current unemployment rate has reached 9.8 percent.

Yet even as jobs continue to be slashed, the housing market seems to be doing just fine. Of course, the government tax credit for first-time home buyers might have a thing or two to do with that.

The National Association of Realtors announced last week that its pending home sales index rose 6.4 percent in August for the seventh straight month. Pending home sales are a loose predictor of actual home sales as they track signed contracts. And while actual sales have been on the rise, they have not matched the pending home sales pace as a certain percentage of buyers back out and as plenty of short sales are rejected by banks before closing.

And the tax credit set to expire December 1 has been a big contributor to the upswing in real sales over the past few months. One survey found that 43 percent of buyers in August were first-timers.

“No doubt many first-time buyers are rushing to beat the deadline for the $8,000 tax credit, which expires at the end of next month,” said NAR chief economist Lawrence Yun. “Sales will decline when the tax credit expires because we are not yet on a self-sustaining recovery path. It also raises a risk of a double-dip recession. Extending and expanding the tax credit is the best tool in our arsenal to encourage financially qualified buyers to stimulate the economy and help reduce the budget deficit.”

If the tax credit is extended, things could continue to look strong in the housing market as long-term mortgage interest rates fell below 5 percent again last week. I guess the question is whether the housing market can find a sustainable level of growth before unemployment figures level off.