WASHINGTON -- Builders have found a way to make money in a decrepit home market: Apartments.

Permit requests to build apartments jumped to a three-year high last month. In 12 months, they've surged 63 percent.

Blame the housing bust, which left many people without the means, the credit or the stomach to buy. More people need apartments. And apartment-home builders are rushing to cash in.

That said, the overall home market remains depressed. Builders are still struggling. They broke ground on a seasonally adjusted annual rate of 628,000 homes last month, the government said this month. That's barely half the pace that economists equate with a healthy market.

High unemployment, stagnant pay and waves of foreclosures have slowed sales of single-family homes, which make up about 70 percent of the home-building market. Apartment construction may be surging, but it's a small portion of the industry.

More apartment building won't add enough jobs to reduce unemployment or hasten an end to the housing crisis. Still, it's contributed to the overall economy's growth for two straight quarters. And many economists expect apartment construction to grow for at least the next 12 months, as long as the economy avoids another recession.

"You're not going to see apartments as an economic driver," said James Marple, senior economist at TD Economics. "But it's renters who are clearly going to drive the demand for housing."

It's also worth keeping the increase in perspective: The growth in apartment construction is coming off extremely low levels. Last year, for example, only 146,000 apartments were built. That was the fewest since 1993. This year's pace isn't much more.

By comparison, in 2005, just before the housing market went bust, 258,000 apartments were built. Some signs suggest that builders could match that level over the next few years.

One such sign: Permits for apartment buildings, a gauge of future construction, have jumped more than 60 percent over the past year. That compares with just 6.6 percent growth in permits for single-family construction over the same period.

Bob Champion, who runs a real estate company in Los Angeles, says he has four apartment projects in development. That matches the number he had in 2005. It's quite a shift from 2006, when Champion's company stopped building apartments because the cost of land had skyrocketed.

Champion has raised rents about 4 percent this year. His occupancy rate is 95 percent. As recently as last year, his rents were flat, and he was dangling incentives, like a free month's rent, to woo tenants.

"People who can't afford to buy a home, rent," Champion said. "That's why the apartment market has stayed healthy." Champion won't likely be building as many apartments next year, though. Land prices have doubled in the past two years, he said. Competition for apartment land has intensified.

For many builders, financing for a project remains a big obstacle. So is time. Apartment projects take an average of 18 months to build.

Still, fewer homebuyers mean more people must rent. Nearly 4 million new renting households were created between 2005 and 2010, according to Harvard's Joint Center for Housing Studies. Under normal economic conditions, that's more than 10 times the number of new renters who would be expected in a five-year span.