
For a true recovery in housing, the market needs resurgent demand from first-time homebuyers and move-up buyers. These two groups are typically the largest source of housing demand. The first-time homebuyer is the bedrock of the housing market. Without first-time homebuyers, no move-up market exists. The first-time homebuyer market is driven by job growth and household formation. When the economy is strong and creating good-paying jobs, young people form new households and use their new income to bid for real estate. This displaces existing homeowners who then execute a move-up trade and often buy a nicer home. That's how the market is supposed to work, but the collapse of the housing bubble destroyed the fundamentals underpinning a strong housing market.…[READ MORE]