Nationwide housing starts rose 15% to a seasonally adjusted annual rate of 658,000 units in September, marking the strongest pace of residential construction since April of 2010, according to figures released by the U.S. Commerce Department on Oct. 19.

The gain was largely attributed to a sharp increase on the multifamily side, which has been trending upward due to increased demand for rental apartments.

"The September numbers are very welcome evidence that builders are putting some crews back to work on single-family homes in select markets where economic conditions are improving, and on multifamily homes in places where demand for rentals is on the rise," said NAHB Chairman Bob Nielsen.

"That said, extremely tight lending conditions for both building and buying new homes — along with stubbornly high foreclosures that are putting downward pressure on home prices — continue to weigh down new construction and corresponding job growth," he said.

Nielsen noted that for every one new single-family home built in this country, three new full-time jobs are created.

"The big gain in multifamily housing production for September was in the wake of a below-trend number in August and in keeping with characteristic volatility in that sector," said NAHB Chief Economist David Crowe.

"However, there's no doubt that demand for apartments is rising as restrictive mortgage lending policies and concerns about future employment push consumers to pursue rental options," he said.

Meanwhile, Crowe said, "Single-family starts showed a slight uptick for the month, which was right in line with our forecast for the third quarter and in keeping with what builders have been telling us in recent surveys regarding the emergence of improving conditions in select local housing markets."

Single-family housing starts rose 1.7% to a seasonally adjusted annual rate of 425,000 units in September, regaining much of the ground they lost in August.

Multifamily starts, which often display substantial swings from month to month, rose 51.3% to a seasonally adjusted annual rate of 233,000 units, their highest level since October of 2008.

Regionally, starts rose across the board in September, with gains of 12.7% in the Northeast, 9.3% in the Midwest, 15.7% in the South and 18.1% in the West.

Building permits, which can be an indicator of future building activity, fell 5.0% to a seasonally adjusted annual rate of 594,000 units in September following a big gain in the previous month.

Single-family permits held virtually unchanged at 417,000 units, while multifamily permits declined 14.5% to 177,000 units.

On a regional basis, permit activity was mixed in September, with gains of 4.9% and 0.9% in the Northeast and Midwest, respectively, and declines of 7.0% and 9.0% in the South and West.

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