Spending on new construction surged by 1.7 percent in January to a record level, the Commerce Department announced.

The department said that construction outlays rose to an $877.9 billion annual rate in the month, far better than the 0.5 percent some analysts had predicted.

The pace of residential construction went to $452.6 billion, a record high. Outlays for private construction rose to a $667.9 billion annual pace, also a new high.