Cramer on housing: 'We are so back'

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Positive U.S. housing data on Tuesday had CNBC's Jim Cramer excited about the future of the sector and retailers that rely on it.

"We are so back," he said on Tuesday.

U.S. housing starts rose to a near eight-year high in July as builders ramped up construction of single-family homes, suggesting that the economy was firing on almost all cylinders.

Cramer attributed a lot of this to the way in which banks have been giving out mortgages in recent months. "The key thing that happened was that this spring the banks started making it so that you got a loan if you needed it," he said.

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He explained that the banks need to start taking some risk in order to make a little more money. "This is all part of a loosening of the banks because it's no longer as hard to get a mortgage, especially one for more than $500,000. It's still difficult, but not as hard."

Cramer also mentioned Home Depot earnings which beat expectations. He said that people were starting to invest in their homes, leading to higher sales at the retailer.

"This is a juggernaut. Home Depot is probably the best we have in terms of this kind of big box [store]."

—Reuters contributed to this report.