Problems migrating project to Webpack 2

I was trying to set up webpack-dev-server but I kept getting errors that required me to update webpack. I ran npm install --save-dev webpack@2.4.1in my root directory to update Webpack, but I get this error when trying to run node_modules/.bin/webpack-dev-server as well as node_modules/.bin/webpack:

Invalid configuration object. Webpack has been initialised using a configuration object that does not match the API schema.
 - configuration.resolve has an unknown property 'root'. These properties are valid:
   object { alias?, aliasFields?, cachePredicate?, descriptionFiles?, enforceExtension?, enforceModuleExtension?, extensions?, fileSystem?, mainFields?, mainFiles?, moduleExtensions?, modules?, plugins?, resolver?, symlinks?, unsafeCache?, useSyncFileSystemCalls? }
 - configuration.resolve.extensions[0] should not be empty.

I know of the migration guide and I applied what I thought was needed to my project but I don't know what I'm missing. This is my webpack.config.js :

const path = require('path');

module.exports = {
  context: __dirname + "/app",

  entry: {
    javascript: "./js/app.js",
    html: "./index.html",
  },

  output: {
    filename: "app.js",
    path: __dirname + "/dist",
  },

  resolve: {
    extensions: ['', '.js', '.jsx', '.json'],
    root: path.resolve(__dirname, './app/js'),
  },

  module: {
    rules: [
      {
        test: /\.jsx?$/,
        include: [
          path.resolve(__dirname, "app")
        ],
        loaders: ["react-hot", "babel-loader"],
      },
      {
        test: /\.html$/,
        loader: "file?name=[name].[ext]",
      }
    ],
  },
}

My package.json looks like:

{
  "name": "AAA",
  "version": "1.0.0",
  "description": "",
  "main": "index.js",
  "scripts": {
    "test": "echo \"Error: no test specified\" && exit 1",
    "dev": "node ./node_modules/webpack-dev-server/bin/webpack-dev-server.js --hot --inline --history-api-fallback"
  },
  "devDependencies": {
    "babel-core": "^6.21.0",
    "babel-loader": "^6.2.10",
    "babel-preset-es2015": "^6.24.0",
    "babel-preset-react": "^6.16.0",
    "eslint": "^3.13.1",
    "eslint-config-airbnb": "^14.0.0",
    "eslint-plugin-import": "^2.2.0",
    "eslint-plugin-jsx-a11y": "^3.0.2",
    "eslint-plugin-react": "^6.9.0",
    "file-loader": "^0.9.0",
    "react-hot-loader": "^1.3.1",
    "react-router": "^3.0.2",
    "webpack": "^2.4.1",
    "webpack-dev-server": "^1.16.2"
  },
  "dependencies": {
    "react": "^15.4.2",
    "react-dom": "^15.4.2"
  },
}

How can I fix this error to launch the dev server and use webpack?

via feners