By most accounts, this year is shaping up to be a positive one for housing, with prices, sales and construction numbers consistently on the rise.

However, there is a catch. Investors may be buying homes -- along with some homeowners — but the overall homeownership rate among Americans continues to fall behind historic homeownership levels. In fact, the homeownership rate declined for the fifth consecutive year in a row, reaching 63.9%, according to the Census Bureau’s latest American Community Survey.

To put this into perspective, the homeownership rate reached its lowest level since the survey was implemented in 2005. It's also the lowest recorded rate since the  census taken back in 1970, said Patrick Simmons, Fannie Mae's director of economic and strategic research.

In a departure from recent trends, housing affordability posted positive improvements across the board.

Between 2011 and 2012, the proportion of households spending at least 30% of gross income for housing declined by nearly two percentage points, lower than at the outset of the Great Recession, the survey pointed out.

"The improvement for renters is particularly notable, as it broke a string of four consecutive years of declining affordability," Simmons noted.

He continued, "The findings related to declining homeownership rate reveal the durability of the demand shift from owning to renting that emerged from the housing crisis and Great Recession, even as affordability improved for owner-occupants and as consumers indicated a continued preference for homeownership over renting."

Nonetheless, first-time homebuyers are still facing various challenges, prolonging the process of buying their first homes.

Although buying remains 35% cheaper than renting nationally, the homeownership rate remains near post-crash levels, explained Truila chief economist Jed Kolko.

"Saving enough for a downpayment is the biggest obstacle to homeownership, especially for young adults still struggling in the job market," he said.

Additionally, tight mortgage credit and even tighter inventory are also challenges for renters who want to buy.

On an interesting note, Kolko pointed out that buying is actually getting less affordable, not more.

"With prices rising faster than rents, and mortgage rates up over the past year, affordability is declining," he argued.

As the baby boomer generation moves out of housing, Generation Y is expected to drive homeownership demand.

But due to a volatile economy and massive amounts of student loan debt, first-time homebuyers are finding it difficult to make their homeownership dreams a reality, explained Jed Smith, managering director of quantitative research for the National Association of Realtors.

"Until you settle down into your life and until you have a family, you tend not to buy — leading to a delayed reaction," he said.

Going forward, the market will see recent prices increases subside. However, interest rates are expected to rise, leading to less affordability in the foreseeable future, NAR's chief economist asserted.