Charles Schwab’s Liz Ann Sonders says that a rebounding housing market will have more of an impact than many believe it will have on the economy.

“People are still underestimating the impact that this is going to have,” Sonders said at the Schwab Impact 2012 conference, CNBC reports. “What people are underestimating is the ripple effect of confidence.”

Sonders says that “just about every metric in housing is starting to turn here,” pointing to builder confidence, home prices, and household formation, among others. “We’re finally having a surge in household formation. We have the right kind of supply and demand balance.”

With housing improving and the U.S. unable to rely on the developing world to boost growth as much as it has in the past, Sonders said it’s key that the U.S. avoid the “fiscal cliff”. And, while she says she still has some long-term concerns about the economy, she says the U.S. is faring better than other countries. “We are the cleanest shirt in a pile of dirty laundry,” she said. “It’s not stellar growth, but certainly the trajectory has improved relative to the rest of the world.”