NEW YORK (CNN/Money) - Housing starts rose to a level not seen in almost 21 years in January, according to a government report issued Wednesday that put the latest reading on real estate market strength well above Wall Street forecasts.

Housing starts rose to an annual seasonally adjusted pace of 2.16 million in January, up from the revised 2.06 million rate in December. Economists surveyed by Briefing.com had forecast housing starts would slow to a 1.93 million pace in the most recent period.

The last time housing starts were stronger was February of 1984, when they came in at a 2.26 million annual pace. But that earlier reading was something of a blip compared to the surrounding months. The January report marked the fourth time in the last six months that housing starts topped the 2 million annual pace mark.

A sharp drop in housing starts in the November report raised brief concerns that the housing market was about to see a dramatic drop. The market has proved very resilient, however, supported by continued low mortgage interest rates. The average 30-year mortgage rate was at 5.71 percent in January, according to a survey by mortgage financing company Freddie Mac. That was the lowest rate since the same 5.71 percent average in January 2004.

Building permits, which are seen as a barometer of builder confidence in the market, rose to an annual rate of 2.11 million in January, compared with a revised 2.07 million pace in December. Economists' consensus forecast had been for permits to slip to a 2 million pace in January. At least one economist said the building permits reading is particularly significant for determining real estate market strength.

"Starts are volatile, but permits have been consistently telling a story of a still-expanding sector," said Robert Brusca of FAO Economics. "While permits may be pointing to weaker growth than what starts suggest, they do point to continued growth."

The jump in housing starts came despite sharp drops in the Midwest and Northeast. But the South, which accounted for nearly half of all the nation's home building, saw nearly a 19 percent gain in housing starts, and the West posted a modest 2 percent gain to outweigh the declines in the cold-weather regions.