Current homeowners are buying new houses and are reaping the fruits of the housing recovery, though more would-be buyers for the first time are finding themselves left behind, a new survey finds.

Current homeowners accounted for 54.2 percent of October’s non-distressed market sales, according to the latest Campbell/Inside Mortgage Finance HousingPulseTracking Survey.

That figure was up from 50 percent from June and shows the housing market is showing fundamental signs of improvement.

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The percentage of non-distressed sales rose to 64.7 percent to total sales in October, up from 55.7 percent in February, which further paints a picture of improving fundamentals.

When it comes to those looking to buy for the first time, many are left out in the cold.

First-time homebuyers accounted for 34.7 percent of all sales, the lowest in three years, and 33.6 percent of non-distressed home sales.

FHA-insured loans, the vehicle of choice for many first-time homebuyers, are tough to find these days, plus regulations may be hampering recovery as well.

“Financing of first-time homebuyers with low down payments threatens to become a significant problem in the U.S. housing market,” Thomas Popik, research director for Campbell Surveys, said.

“Fifty percent of first-time homebuyers use FHA financing, but FHA insurance premiums are increasing and underwriting is becoming more strict. Private mortgage insurance has started to fill the gap, but the long-term status of private mortgage insurance is in question pending the publication of the Qualified Residential Mortgage regulation resulting from Dodd-Frank.”

Still, the sector continues to show signs of improvement.

The Commerce Department reported recently that housing starts jumped 3.6 percent in October to a seasonally adjusted annual rate of 894,000 units — the highest levels seen since July 2008.

Economists viewed the jump in groundbreaking as further evidence the housing sector has turned a corner and is moving forward.

“The broad improvement in home prices, home equity, starts and inventory clearing are key developments that position the economy for stronger growth next year, and beyond,” said Eric Green, chief economist at TD Securities in New York, according to Reuters.

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