Housing starts rebounded in February, surging by 10.7%— signaling a recovery in the housing market. This resurgence was primarily driven by single-family home construction, which experienced a significant uptick. Meanwhile, multi-family home starts continue to face challenges.

Yahoo Finance's Dani Romero breaks down the details.

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Editor's note: This article was written by Angel Smith

Video Transcript

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AKIKO FUJITA: Housing starts rebounded in February from weather-related weakness at the start of the year. Yahoo Finance's very own Dani Romero has more on the housing market's recovery. Dani.

DANI ROMERO: Akiko, what a turnaround story for the housing starts in February. Both single-family and multi-family housing starts jumped 10.7% last month. And that was the strongest monthly gain since May of last year. And this really-- this strong gain actually came from the single-family start home side, which is up 35% from a year ago, signaling that building conditions were good in February. Also, it shows that builders remain optimistic about the spring selling season.

Now, multifamily is a little bit of a different story there. Starts for those types of homes are down 34% from a year ago. But also real estate is very regional. So regionally, the Midwest and the South are really showing some strength, while in the Northeast and the West are really showing some weakness on that side. Bottom line, the new home market is still outperforming the existing home sales side. And builders are benefiting from this dynamic.

One of their major advantages is that they're offering these incentives, like mortgage rate buydowns, which is when you-- the builder upfronts the cost to lower the rate on the loan. That has been a big seller when trying to attract buyers into that type of market. But the rebound in February that we're seeing in these housing starts and permits really signals that the housing market is healing as mortgage rates are softening. Akiko.

AKIKO FUJITA: OK. Let's hope that momentum continues. Dani Romero, thanks so much for bringing us that story.