The Commerce Department reported on Friday the housing starts surged by 19.4 percent m-o-m in March to a seasonally adjusted annual pace of 1.739 million (the highest level since June 2006), while building permits rose by 2.7 percent m-o-m to a seasonally adjusted annual rate of 1.766.

Economists had forecast housing starts increasing to a pace of 1.613 million units last month and building permits rising to a pace of 1.750 million units.

Data for February was revised to show homebuilding growing to a pace of 1.457 million units, instead of increasing at a rate of 1.421 million units as previously reported.

According to the report, permits for single-family homes, the largest segment of the market, rose 4.6 percent m-o-m to a rate of 1.199 million units in March, while approvals for the multi-family homes segment decreased 1.2 percent m-o-m to a 567,000 unit-rate.

In the meantime, groundbreaking on single-family homes climbed 15.3 percent m-o-m to a rate of 1.238 million units in March, while housing starts for the multi-family surged 30.0 percent m-o-m at a 477,000 -unit pace.