WASHINGTON - Construction of single-family homes rose for the fifth-straight month in July as more buyers walked into model homes ready to sign contracts, the Commerce Department said Tuesday.

The pace of single-family home construction edged up almost 2 percent, and building permits for future construction climbed nearly 6 percent. The confidence level in the industry this month is the highest in more than a year, the National Association of Home Builders said Monday.

As homebuilders hire more workers to pour foundations and pave roads, they are providing long-needed juice to the economy. With new construction up 37 percent from the bottom this past winter, the housing industry this quarter is expected to give a small boost to the nation's economic output for the first time in 31/2 years.

"It's the general trend that matters and with housing, the direction is up," wrote Joel Naroff, president of Naroff Economic Advisors.

Of course, it's not all good news. New home construction is still off more than 70 percent from the peak in January 2006, and apartment construction fell 13 percent from June to July.

That pulled the combined figure for homes and apartments down 1 percent to a seasonally adjusted annual rate of 581,000 units, down from an upwardly revised rate of 587,000 in June. Economists polled by Thomson Reuters expected a pace of 600,000 units.

It's unclear whether the trend will continue. July was the last month that builders could start new homes and have first-time buyers qualify for a new tax credit. Buyers can save 10 percent on the price of a home, up to $8,000 in taxes, if they complete the purchase by the end of November.

Builders and real estate agents are pressing Congress for that credit to be extended.