U.S. housing construction staged a surprising rebound during September after back-to-back declines, and building permits climbed.

Housing starts increased 3.4% to a seasonally adjusted 2.108 million annual rate, the U.S. Commerce Department said Wednesday.

The September increase defyied expectations of a slowdown in the booming U.S. housing market.

Economists had called for starts to decline 1.7% to a 1.975 million annual rate in September.

The report also showed permits for future building rose by 2.4% in September to a 2.189 million annual rate. Permits had been projected by economists to slip 3.7% to 2.058 million.