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New home construction in the U.S. jumped in September to its highest level in four years, based on Commerce Department data released Wednesday.

At an adjusted seasonable rate of 872,000 for the month, that's better than expected; 15 percent above the revised August estimate of 758,000, and nearly 35 percent above the September 2011 rate of 647,000.

The rate for single-family home starts was 603,000, which is 11 percent above the August figure of 543,000; and for buildings with five units or more, it was 260,000.

"It's no longer a question of whether the industry is rebounding," Larry Sorsby, chief financial officer of New Jersey-based Hovnanian Enterprises Inc., said in a telephone interview to Bloomberg today. "There is clear evidence that we have bounced off the bottom and are in the midst of a recovery." Hovnanian's is the best-performing homebuilding stock so far this year.

Historically low interest rates have played a role in the uptick and there is speculation that a 2 percent growth in the number of U.S. households last year has also played a role, the biggest gain in 10 years, to 119.9 million, according to the most recent Census Bureau data.

There is optimism that the increase in housing starts will also benefit the construction employment market which lost two million jobs since the end of 2007, as reported by Bloomberg.

The good news also builds on a surprise jump in retail sales by 1.1 percent in September, according to another Commerce Department report released earlier in the week. Industrial production also gained more in September than was forecast.

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