Let's take a look at real gross domestic product (GDP), residential construction and the employment rate to help gauge the national housing market. GDP grew at a healthy 3.2% pace in the first quarter, the third consecutive quarter in which the U.S. economy was on the mend. Personal consumption expenditures, investment — primarily in rebuilding inventories and in equipment and software — and exports were the major drivers of growth.

Residential construction, which provided a lift to GDP growth in the third and fourth quarters of 2009, was a minor drag in  this year's first quarter, reducing growth by 0.3%. Though down from the fourth quarter's 5.6% growth rate, the economy is still expanding at a strong enough pace to create jobs faster than population growth is adding to the labor force, a trend that is expected to continue.

The employment situation will also improve as companies see the opportunity to increase output. In the early phase of a recovery, productivity growth is customarily high as businesses meet rising demand by getting more work out of their current employees, such as retail clerks who were previously waiting on an average of two customers an hour are waiting on five as business picks up.

Companies can also bring back on line or speed up idle or underutilized machinery. However, as the recovery continues, these opportunities become harder to find and firms must then hire more workers in order to increase output, reducing productivity growth.

What is occurring now is following this familiar pattern. Productivity growth in this year's first quarter fell to a rate of 3.6%, down from 6.3% in last year's fourth quarter, which was down from 7.8% in the third quarter. Nonetheless, first quarter growth still exceeded the post-World War II average of 2.3% leading into this recession and the 2.8% for the 10-year period prior to its start.