NEW YORK (CNN/Money) - Housing starts jumped 11 percent in April, to 2.038 million new units, the Commerce Department said Tuesday.

"I was obviously delighted to see this rebound," said David Seiders, chief economist with National Association of Home Builders. "I think what it tells us is that the housing market is still fundamentally strong."

Seiders said that mortgage rates falling below 6 percent "continue to be very supportive" in luring new home owners into the market.

The rise in new home starts follows a plunge in the previous month of March, when housing starts dropped 17.6 percent. The March drop was the steepest in more than 14 years.

"I'd say this is another very important signal that the economic soft patch we were all worried about is pretty much confined to March," said Seiders. The economist said he was "still trying to figure out why the March numbers were as weak as they were."

New home permits rose 5.3 percent to a seasonally adjusted annual rate of 2.13 million for April, the Commerce Department said. Economists use the permit number to project the level of future housing construction.

John Lonski, chief economist for Moody's Investors Service, said that a spur in mortgage applications in early May "indicates strong demand for home purchases that will lend a boost to housing activity for the foreseeable future."

"There is no better mix for the housing outlook than to have benchmark Treasury yields decline amid an improving employment situation," said Lonski. "So I think it's going to be a better than expected year for housing."

Single-family housing starts jumped 6.3 percent to a 1.635 million unit pace. Starts on multi-unit housing surged 34.0 percent to a pace of 351,000.

Housing starts plunged 17.8 percent in the Northeast, rose 6.2 percent in the Midwest, soared 25 percent in the South and edged up 2.5 percent in the West.

Lonski said the severe contrast in housing starts that occurred over the last couple months is tempered by overall positive economic news. "Theres a lot of volatility in the [housing starts] number, but still, the outlook is quite good, given that you have a declining Treasury yield amid above average economic growth," said Lonski.