Jerusalem (CNN) -- Israel approved the construction of several hundred housing units in the West Bank, the prime minister's office said early Sunday, a day after five Israelis were killed in their home in the disputed territory.
The government approved the construction in the settlements of Gush Etzion, Maale Adumim, Ariel and Kiryat Sefer in a rare Saturday-night decision.
The development came shortly after five members of an Israeli family were killed in the West Bank, in what Israel is calling a terror attack.
"The terrorists murdered a young family, a mother, a father, a boy of 11, a boy of 4, a baby girl of four months. They all had their throats slit," Prime Minister Benjamin Netanyahu said Saturday.
Throngs of mourners gathered in Jerusalem Sunday for the funeral of Ehud Fogel 36, his wife Ruth, 35, and their children Yoav, Elad and Hadas. The event was broadcast on Israeli television.
Their bodies were discovered by the Fogels' 12-year-old daughter when she came home Friday night, a family neighbor told Israeli media. Two other children were left alive when the killers apparently did not notice the door to the room they were sleeping in.
"In a moment they were torn away from us by the force of monsters, vicious animals that were capable of slashing the throats of a boy or a baby a few months old," said Rabbi Meir Lau, former chief rabbi of Israel, at the burial service for the slain family members.
Mourners encircling the shrouded bodies of the victims wept and prayed.
Ruth Fogel's father, Rabbi Yehuda Ben Yishai said "our children are prepared to be sacrificed as an offering at the altar we have to continue to build to bring redemption. Hudi and Ruthie wanted this redemption."
Israeli government spokesman Mark Regev said that "all objective data based on the investigation" led the government to believe "the only possible conclusion" was that the settlement murders were a terror attack. He would not elaborate on what evidence was leading investigators to that conclusion.
Netanyahu convened a special meeting of the ministerial committee for settlements Saturday night after the killings.
Interior Minister Eli Yishai argued that not enough new housing had been approved, saying the number should have been 5,000 units -- 1,000 for each person murdered.
Nabil Abu Reudeina, a spokesman for Palestinian Authority president Mahmoud Abbas, called the Israeli decision "wrong and unacceptable" in a statement reported by the official Palestinian Authority news agency Wafa.
He warned that it could lead to a further escalation of conflict between Palestinians and Israelis.
The Palestinian Authority and many international observers object to the expansion of Israeli settlements in the West Bank, which the Palestinians want to be the basis of a future state. Israel has temporarily halted settlement expansion in the past, but says a permanent freeze is a matter for negotiations with the Palestinians.
According to a military spokeswoman, an intruder entered the Israeli settlement of Itamar near the northern West Bank city of Nablus around 1 a.m., made his way into the family home and killed the two parents and their three children.
Abbas spoke to Netanyahu to express his sorrow over the event, the Israeli prime minister said Sunday -- adding it did not go far enough.
"I told him that we expect much more unequivocal condemnations but even more than that, we want to see unequivocal action by the PA to stop allowing this incitement, that it stop leading this incitement," Netanyahu said, according to his office.
On Sunday, military units continued their search of the surrounding area for the assailant.
Military spokesman Maj. Peter Lerner said more than one person may have carried out the crime.
Netanyahu demanded that the Palestinian Authority assist in finding those responsible and "halt the incitement in the mosques and via the Palestinian Authority-controlled media."
He did not explicitly blame Palestinians for the deaths.
"This is a heinous act of a murder of a whole innocent family -- parents, children and baby -- while they were sleeping in their home on the Sabbath night," Netanyahu said. "Israel will not accept such a heinous murder and will act strongly to keep the safety of the lives of Israeli citizens and punish the murderers."
He added, "We all know, as do those who want to strike at us will know, that the future of the settlements will not be decided upon by terror."
Palestinian Authority Prime Minister Salam Fayyad denounced the killings.
"I say that in regards to what happened (Saturday) in Itamar settlement -- and the victims were a toddler and two children, the father and mother -- exactly as we have always said against violence ... we refuse this and condemn it," Fayyad said, according to his spokesman, Ghassan Khatib. "We refuse and condemn violence, whatever the reasons are or the perpetrators or targets or victims."
The White House condemned the slayings "in the strongest possible terms" and said the killers of the "heinous" act must be held accountable.
"There is no possible justification for the killing of parents and children in their home," it said in a statement.
Secretary of State Hillary Clinton added that she was "shocked and deeply saddened" by the incident.
"The murderers must be found and brought to justice," she said, asking the Palestinian authorities "to assist in every way possible."
The United Nations, the European Union, the Russian Federation and United States also issued a joint statement condemning the murders. The four entities are members of the Quartet on the Middle East, an association involved in mediating the peace process between Israel and the Palestinians.
"The Quartet condemns in the strongest possible terms the violent murder of an Israeli family of five, including three young children, in the West Bank today," the statement read. "The Quartet offers their condolences to the loved ones of the victims and to the Israeli people."
"Attacks on any civilians are completely unacceptable in any circumstance," the statement continued. "The Quartet calls on those responsible to be brought to justice and welcomes the strong condemnation of this attack by President Abbas and the Palestinian leadership."
CNN's Shira Medding and Kevin Flower contributed to this report.