Many Twin Cities home builders and remodelers are no doubt still suffering the worst construction drought in a lifetime, but there are signs of better times ahead.

Ryan Jones of the Twin Cities MetroStudy office said yesterday that there were 3,276 new housing starts in the Twin Cities during the first quarter, up 3.8 percent compared with last year. That puts the supply of new houses in the Twin Cities at 7.1 months. The market is considered healthy, or in balance, when there's a six- to seven-month supply.

MetroStudy tracks housing construction throughout the country by driving through developments and counting vacant lots, houses under construction and houses that are for sale. It's a different approach than the one taken by the Builders Association of the Twin Cities, which contracts with the Keystone Report to collect building permit applications from various municipalities. A "start" signals construction of a home and comes after the permit is pulled. During March alone home builders had plans to build 639 new units, according to the Keystone Report. That was a 164 percent increase compared with last year, but more than half of those units were rental apartments .

Jones said that new household formation and an improving economy will help boost prospects for the Twin Cities, which he said has become one of the healthiest construction markets in the country. Still, new home sales need to pick up to keep pace with construction. "While new home activity is still hovering at painfully low levels," Jones said. "The market is poised for more consistent expansion in 2012."

Remodeling activity is also on the upswing. The Joint Center for Housing Studies of Harvard University said that annual remodeling activity is expected to increase 5.9 percent by the end of the year. That sector of the industry is getting a boost from stronger home sales and and low mortgage interest rates, which are enabling homeowners to borrow money to do fix-up projects around the house. The increase comes after two years of bouncing around a historic low point for the industry. "Hopefully, we're finally moving beyond simple volatility in the home improvement spending numbers to a period of sustained growth," said Eric Belsky managing director of the Joint Center. You can read the full report here.