Full-fledged recovery for housing is still a while away. But after a long time of near dormancy, it looks like it is starting to stir, as the conditions for improvement are there. The job market has continued to strengthen—there were 2.8 million more people working last month than in the same month a year ago. More people are striking out on their own: Goldman Sachs estimates the number of newly formed households eclipsed 1 million last year, marking the first time that has happened since 2006.
What’s more, the firm estimates 1.2 million new households will be added in each of the next four years. That being said, the U.S. housing market isn’t close to what historically would be considered normal. Last year, a combined 5.1 million new and used homes were sold in the U.S—not quite as many as in 1998, when the working-age population was one-fifth lower than it is now.