WASHINGTON (MarketWatch) -- Construction of new single-family homes and apartments accelerated in August to the strongest pace in nine months, a further sign of steady improvement in home building since the beginning of the year, the Commerce Department reported Thursday. Total housing starts rose 1.5% to a seasonally adjusted annual rate of 598,000, the highest figure since November 2008. Building permits increased 2.7% to 579,000, also the highest level since November. All of the increase in housing starts in August came from the multifamily sector. Single-family starts fell for the first time in six months. Total starts were very close to the 600,000 annual rate expected by economists surveyed by MarketWatch. Starts have moved steadily higher since January. Builders credit an $8,000 tax credit for first-time buyers for much of the improvement. They want the credit extended past its scheduled Nov. 30 expiration. Starts are down 29.6% in the past year, while starts of single-family homes are down 21.7%. But starts are up 22.5% since January. Housing completions dropped 5.5% to a seasonally adjusted annual rate of 760,000. Completions are off 25.3% in the past year. The government cautions that housing data are volatile and subject to large sampling and other statistical errors. In most months, the government can't be sure whether starts increased or decreased. Large revisions of reported figures are common. It can take four months for a new trend in housing starts to emerge from the data. In the past four months, housing starts have averaged 1.24 million annualized, down from 1.28 million in the four months ending in October. On Wednesday, the National Association of Home Builders reported builder sentiment improved marginally in September as the expiration of a tax subsidy for first-time buyers approached. That housing-market index rose to 19 in September from 18 in August. It was the third straight increase in the gauge that measures whether builders think the market is good, fair or poor.

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