Starts on privately owned housing totaled an annual rate of 698,000 units, a pace 1.1 percent below the revised January estimate of 706,000, the Commerce Department said. The upwardly revised January number marked the most robust construction starts since October 2010. The pace of housing starts, an indicator of the health of the country's construction industry, was 34.7 percent above the level of February 2010. Building permits, a forward-looking indicator, rose for the second straight month in February, up 5.1 percent from January to an annual pace of 717,000, the department said. That was their highest level since October 2008. The US housing market is still bottoming out six years after a price bubble burst, posing a key challenge to the economy's recovery from a deep 2008-2009 recession, according to the Federal Reserve and economists. Despite mortgage rates hovering at record lows, home sales remain depressed amid falling home prices, rising foreclosures and high unemployment, which, though slowly diminishing, stood at 8.3 percent in February.