The UK construction industry ended 2013 on a high, with output up 2% in December from the month before, and 6.3% higher than in December 2012.
The boost was led by the greatest output of new housing since the first quarter of 2008, helped by government schemes such as Help To Buy, which has made it easier for first-time buyers to get on the property ladder, the Office for National Statistics said.
Some have speculated that the surge, particularly in London, means Britain could be on the brink of another housing bubble. House prices have risen 9% over the last year according to mortgage lender Nationwide.
In the three months to September, the latest data available, housebuilding starts rose 8%. Overall, the number of new residential construction projects are now 89% above the trough in March 2009 but completions are still 40% below their March 2007 peak, government statistics show.
However, Britain’s construction industry is still a long way from being restored to its pre-recession glory. Output is still 12.2% below its pre-crisis peak, a weaker state than in manufacturing or the services sector.
It comes as Britain's economy also shows signs of being well on track to recovery. GDP output grew by 0.7% in the three months to December according to an initial ONS estimate last month.