Builders are antcipating a strong home building season.
NEW YORK (CNNMoney) -- Home builders are getting ready for a stronger construction season, filing for the most building permits in more than three years, in another sign of recovery in the long-battered housing market.
The government reported builders filed for permits at an seasonally adjusted annual rate of 717,000 in February, the strongest reading since October 2008, which was the month after the meltdown in financial markets. It marked a 5.1% rise from January and a 34.3% increase from year-ago levels.
Actual starts of new homes slipped slightly from a very strong reading start to the building season in January, down 1.1% to 698,000. Still, that was 35% ahead of year-ago starts.
The starts are more affected by weather factors. But the permits are generally seen as an indication of builders' confidence in the market and the demand they are seeing. And mortgage rates near record lows and an improving jobs market both are feeding stronger demand.
New home construction is still only a fraction of levels during the building boom in the middle of the last decade. But years of low building since the housing bubble burst have left inventories of new homes very tight, helping to spur more activity by builders.
Stocks of major home builders such as PulteGroup (PHM, Fortune 500), D.R. Horton (DHI, Fortune 500) and Toll Brothers have all posted double-digit gains in the last three months.
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