Single-family permits, a gauge of future housing production, posted a double-digit gain in May as the new-home market showed an increase in activity. The pandemic in March and April brought the sector to mostly a standstill as economies shut down in an effort to curb the spread of the coronavirus. But as states reopen, home buyers are coming back and builders are ramping up production to meet demand.

Permits to construct new houses in May rose 14.4% to a 1.22 million annual pace.

Total housing starts, which includes single-family and multifamily construction, rose 4.3% to a seasonally adjusted annual rate of 974,000 units, the Commerce Department reported Wednesday. Broken out, single-family starts moved just 0.1% last month, but builders were quick to point to the increase in permits as a positive sign that more activity is coming. Housing starts in the multifamily sector, including apartment and condo buildings, jumped 15% in May to a 299,000 pace.

Read more: Builder Sentiment Has Never Risen by This Much in a Month

“We are seeing many positive economic indicators that point to a recovery, including low interest rates, rising demand, and an increase in mortgage applications,” says Dean Mon, chair of the National Association of Home Builders. “Single-family and multifamily housing production are on an upward path while overall permits, which are a harbinger of future building activity, posted a double-digit gain.”

Further, “builders are bringing back thousands of workers laid off in March and April to meet renewed demand,” says NAHB Chief Economist Robert Dietz.

Builders are feeling more confident. This week, an index measuring homebuilder sentiment surged 21 points in June, the largest monthly increase ever recorded by the NAHB and its Wells Fargo Housing Market Index.