Market analysts and real estate experts breathed a sigh of relief as last month’s housing starts registered the highest increase since November last year after a series of declines.

According to the U.S. Department of Commerce, groundbreakings for new homes expanded by 10.5% in August to an annual rate of 598,000 units. The figure surpassed market expectations as analysts earlier predicted an increase of just a 550,000-unit pace.

Industry experts attributed the surge to a growth in activity in the multifamily sector. Official data showed that construction starts of multifamily homes jumped by almost 30% to an annual rate of 160,000 units last month. Single-family starts, on the other hand, climbed 4.3% to 438,000 units during the same period. The figure is reportedly the highest since June this year.

Meanwhile, new building permits for future home construction increased by 1.8% to a 569,000-unit rate, surpassing earlier predictions by 9,000 units. Like in the case of housing starts, the growth in the number of new building permits was bolstered by a 9.8% increase in the multifamily sector. Permits for single-family homes, however, declined for the fifth-straight month.

Despite the latest development, certain experts believe that it would take quite some time before the housing market fully recovers. “It is reasonable to believe that the post-tax credit plunge in housing activity, both sales and construction, is over, but we do not expect to see a strong recovery any time soon,” said Ian Shepherdson, chief economist of the New York-based High Frequency Economics.

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