The homeownership rate, which has dropped sharply since the property bubble popped 10 years ago, reversed to reach 63.5 percent in the third quarter, the Census Bureau said Thursday.

That is a significant jump from the prior quarter, when it hit touched a 51-year low of 62.9 percent, according to The Wall Street Journal.

One key reason for optimism is that new homeowners entered the market, as about half of the 1.1 million households formed in the third quarter were first-time buyers.

“For me the big reason to be optimistic is looking at household formation,” said Ralph McLaughlin, chief economist at Trulia, told the newspaper.

Home prices have rebounded to within 0.1 percent of the July 2006 peak, according to S&P CoreLogic Case-Shiller Indices, because of a lack of inventory and low interest rates. Meanwhile, young people still struggle to afford houses due to tight mortgage credit, difficulty saving for a down payment and a lack of starter-home availability.

There are other reasons for caution.

“The homeownership rate is still lower than it was a year ago, when it sat at 63.7 percent, compared with 63.5 percent today,” the WSJ reported. “Seasonally adjusted, the change in the homeownership rate to 63.4 percent from 63.1 percent in the prior quarter isn’t considered statistically significant.”