TODAY   |  January 26, 2013

Potential pitfalls as economy gains momentum

After the worst economic downturn since the Great Depression, the economy may be ready to take off again, but rising mortgage rates and tight lending could threaten housing, and unforeseen political or economic events could topple stock prices. NBC’s John Yang reports.

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>>> the economy and signs that it may be ready to take off again. there is still concern over whether there could be potential pitfalls and what it means to you. with that, more from chicago. [ bell ]

>> reporter: the stock market winning streak is at its fourth straight week. there are encouraging signs on jobs and higher home prices . the government reported that sales of new homes shot up nearly 20% in 2012 . and home prices went up almost 14%.

>> this is the new pricing power that --

>> reporter: diana oleck covers pricing for cnbc.

>> home pricing is nowhere near where we need it to be. we're at half the amount of housing starts that we would be in a normal year.

>> reporter: any news is good for me toberry homes outside of columbus, ohio. they haven't been this busy since 2006 . they've doubled their staff in the past year.

>> pretty much every subcontractor in every field has been hiring employees.

>> reporter: on wall street , the dow finished each week of the new year higher than it began. up 112% since the recession low in march, 2009 , and poised to set a new record high perhaps as soon as next week. that's encouraging for americans who have an estimated $6.5 trillion of their retirement savings tied up in stocks. analysts say the rally began after washington policymakers avoided the fiscal cliff and has continued as investors chase higher stock prices.

>> when that light bulb goes off and people say, hey, wait a minute, the market really is getting better, maybe the economy's getting better. that train is leaving the station, i'd better not let it leave without me.

>> reporter: is the economy about to gain momentum? there's still potential pittfalls. rising mortgage rates and tight lending could threaten housing. unforeseen political or economic events could topple stock prices. some analysts say the stage is set.

>> we've made a lot of adjustments. now the economy really has breathing space to really improve.

>> reporter: another potential speed bump for economic growth , the increase in payroll taxes that's now showing up in paychecks. some analysts say they hope that the effect of that will be offset by new jobs and the new wages that come with them. for "today," john yang , nbc news, chicago.