The Joint Center for Housing Studies at Harvard University pictures a sunny landscape for residential construction in its annual report on the state of housing nationwide—home sales and prices are up, as is household formation, while the existing-home inventory continues to shrink.

But a 0.7-percentage-point slide in the number of Americans who own homes to 65.4% in 2012 from 2011 has some industry watchers questioning whether the forecast growth is an accurate measure of the market's true potential. Builder magazine runs down what you need to know from this year's report. Read more.