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Workers prepare a new housing lot at a construction site in Alexandria, Va.KEVIN LAMARQUE/Reuters

Royal Bank of Canada's Tom Porcelli has spent some considerable effort this week deconstructing the U.S. housing recovery. His advice to the bank's clients: Curb your enthusiasm.

For the first time in, like, forever, housing is contributing to America's gross domestic product rather than subtracting from it.

The Federal Reserve's policy committee was buoyed by a stronger housing market at its January meeting, and a "couple" of members "saw the housing market as having the potential to cause overall growth to be stronger than expected this year," according to the minutes of that session.

The Commerce Department reported Wednesday that builders started work on homes at an annual rate of 890,000 in January, compared with 720,000 a year earlier.

Existing homes sold at an annual rate of 4.9-million in January, a 0.4-per-cent increase from December and 9.1 per cent higher than a year ago, the Washington-based National Association of Realtors reported Thursday. The supply of homes on the market would be exhausted in 4.2 months at that pace, representing the smallest inventory of homes since April 2005. A dwindling supply should keep upward pressure on prices, which increased more than 12 per cent from January 2012 to $173,600 (U.S.), according to the association's calculation of the median national existing-home price

Mr. Porcelli, chief U.S. economist at RBC Capital Markets in New York, isn't disputing that housing is finally on the rise. Nor does he disagree it will add to GDP in 2013 – he just doesn't think the contribution will be that great.

Housing starts are being driven by unusually strong construction of apartment and condo buildings – about 45 per cent of the increase from the trough in new construction, even though multi-unit structures represent only about a third of aggregate starts.

This makes for some volatile readings. Starts actually contracted 8.5 per cent in January from December because of a 24.1-per-cent plunge in multi-unit starts, which are notoriously volatile. Housing starts jumped 15.7 per cent in December on a surge in multi-unit construction.

But that's not really the point. More important is that 90 per cent of all those new condo units are being leased rather than sold, according to Mr. Porcelli.

That could make this housing recovery far different than others. The reason: Multipliers.

Renters spend far less on their units than do owners. Digging even deeper, Mr. Porcelli finds that the square footage of new housing units has been shrinking since 2010 and is now about 11 per cent below the pre-crisis peak.

That's disappointing news for hardware stores, furniture suppliers and art galleries. "Downsizing does not beget constructive multipliers for spending – quite the opposite," Mr. Porcelli said Wednesday in a research note.

And one more thing: Mr. Porcelli also is advising caution on housing leading to sharp increase in hiring. That's because the ratio of construction jobs to housing starts already exceeds its average dating back to 1985.

He estimates that housing starts could increase to an annual rate of 1.2 million before the relationship between starts and construction headcount reached its historical norm. In other words, builders currently have all the workers they need.

Mr. Porcelli's analysis is like a cold shower. He won't get especially excited about housing until Americans start buying single-family homes. In January, builders broke ground on 613,000 such units, the most since July 2008. That's something, but Mr. Porcelli would say there still is a long way to go.