Over the first half of the year the number of new households has grown by 1.7 million over the same period a year ago, the largest annual growth in a decade.

Households will continue to grow as young workers earn enough to live on their own and marry, adding about 1.2 million per year, on average, for several years according to Frank Nothaft, chief economist at CoreLogic.

In fact, the Joint Center for Housing Studies at Harvard University has projected an increase of 11 to 13 million households over the next decade, depending in part on the pace of immigration into the U.S.

“A stronger pace of household formation has been a missing ingredient needed to bolster the housing recovery. Household formation, which refers to an individual, couple, group or family that forms their own independent living quarters, had been running at very low levels since 2007 but has recently accelerated,” Nothaft said in a post on CoreLogic’s blog.

The post-World War II baby boom led to high household growth, averaging more than 2 percent per year between the mid-1960s and the early 1980s, a period when the boomer cohort attained the prime ages for household formation. Then household formation rates nearly halved between 1990 and the mid-2000s when the smaller birth cohorts of the 1970s were aged in their 20s, Nothaft wrote.

Likewise, the economy has an important effect on household formation. During an economic recession the rate of formation generally slows, reflecting the loss of good-paying jobs. During a recession, young adults may choose to live with family or share housing with roommates rather than get their own home. And job layoffs could force some who had already formed their own household to move back in with relatives. This effect was particularly pronounced during the Great Recession, the longest and deepest recession since the 1930s. Household formation rates fell to the lowest levels recorded since the end of World War II.

Immigration is not the primary driver of household growth in the U.S., but immigrants have helped to support the housing recovery by forming households, renting or buying homes, and thus supporting home values in many hard-hit housing markets. With household formation now rising among the native-born population, the higher level of formations may provide the catalyst for more substantive gains in new home construction in the coming year, aiding the overall housing recovery.