JERUSALEM (AFP-EJP)---The crisis with key ally the United States over housing construction east Jerusalem has ended, the office of Israeli Prime Minister Benjamin Netanyahu said.

"Netanyahu called (Vice President Joe) Biden and both agreed the crisis is behind them," an official in the premier's office said.

Netanyahu said later he had spoken to Biden and "expressed his regret for the unfortunate timing."

Israel caused an uproar by announcing during Biden's visit on Tuesday it had given the green light for construction of 1,600 new homes in east Jerusalem.

Vice President Joe Biden welcomed Netanyahu's response.

"Sometimes only a friend can deliver the hardest truths, and I appreciate ... the response by the prime minister today," Biden said in a speech at Tel Aviv University.

He noted that Netanyahu "clarified that the beginning of actual construction on this particular project would likely take several years."

   "

That's significant because it gives negotiators the time to resolve this as well as other outstanding issues," said Biden, while reiterating condemnation of Israel's go-ahead for the construction.

In his speech, Biden stressed the importance of US-Israel friendship and Washington's commitment to the security of the Jewish state, saying that "US President Barack Obama and myself know that the US has no better friend in the community of nations than Israel."

"The cornerstone of the relationship is our absolute, total, unvarnished commitment to Israel's security," Biden said.

 "Progress occurs in the Middle East when everyone knows there is simply no space between the United States and Israel. There is no space between the United States and Israel when it comes to Israel's security."

He also stressed the US determination to prevent Iran from acquiring nuclear weapons and demanded Tehran stop its support of "terrorist groups,"

which he said threaten Israel as well as US interests.

"We are working with many countries around the world to convince Tehran to meet its international obligations and cease and desist," Biden said.

"Iran must also curb its other destabilising actions in the region well beyond their desire to acquire nuclear weapons, and that is their continued support for terrorist groups."

Biden is the highest-ranking US official to visit Israel and the West Bank since President Barack Obama took office a year ago.