Prices are increasing quickly, though that may not always be the most healthy development for the economy. Also, banks may soon loosen overly strict requirements, but a choke point remains in new-home construction.

Modest growth in the economy and an improving job picture bode well for both residential and commercial real estate in 2013.

If regulators fail to restore rules that honor the important roles of free enterprise and private property ownership, some may be unable to climb the economic ladder.

Home sales volume last year was up modestly over 2010, but there was an important shift in their composition: Investors were stepping up to buy while households dropped back. There’s a positive side to this. Our surveys show that households getting into the market are doing so for all the right reasons. They’re seeking a different home or another neighborhood. They’...