And new-home sales jumped 16 percent last month from December to the highest level since July 2008, the Commerce Department said Tuesday.
Home prices, meanwhile, rose by the most in more than six years in the 12 months ending in December.
Steady price increases are also contributing to the housing recovery. They encourage more people to buy before prices rise further. Higher prices also build homeowners' wealth, which can spur more spending and economic growth.
Builders, meanwhile, started work on the most new homes in 4 ½ years in December. Last year was the best year for residential construction since 2008, just after the recession started.
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