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Forecast Lowered for Single-Family Homes : Construction: Research firm expects about a 10% drop in housing starts this year from 1989.

TIMES STAFF WRITER

In the face of continued declines in housing construction in California, a Burbank-based research firm has revised its projection of 1990 housing starts.

The Construction Industry Research Board (CIRB) forecast of 215,000 starts--nearly 10% below 1989’s 237,700 starts--remains the same, but the single-family forecast of 143,000 was lowered to 138,000, according to Ben Bartolotto, CIRB research director.

The multifamily forecast of 72,000 units was raised to 77,000. Increases in multifamily units are centered in the San Diego, San Jose and Fresno metropolitan areas, he said.

For the first three months of 1990, housing starts totaled 50,657, down 5.7% from the same period last year, Bartolotto said. On an annualized based, March’s 206,200-unit annual rate is the lowest for any month since the 195,500-unit annual rate in October, 1983, he said.

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Fred Cannon, an economist with the Bank of America, predicts that California housing starts will be in the 210,000 to 230,000 range this year. This range represents what he calls a “normalizing” of construction, since it is the long-term annual average of housing starts in California.

“I don’t believe the doom and gloom statements that are going around about the collapse of California’s housing market, despite mortgage interest rates that have stayed higher longer than I expected,” he said. “Look at how 1989 ended up: I thought I was being overly cautious all year predicting 225,000 starts and we ended up with nearly 240,000.”

Despite the housing downturn, California will be the nation’s top home-building state this year, according to U.S. Housing Markets, a Detroit-based newsletter published by Lomas Mortgage USA.

The newsletter forecasts 226,300 starts for California, with Florida second, with 140,900. Washington is third, with 55,700. Nationally, there will be 1,302,000 starts, the lowest since 1982, the newsletter predicted.

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The National Assn. of Home Builders has lowered its 1990 forecast from 1.42 million starts to 1.28 million, the smallest number since 1982’s 1,062,000. That year, California recorded 85,700 housing starts, the lowest since World War II, Bartolotto said.

PROJECTED LEADERS IN HOUSING STARTS

Permits 1989 Projected Total Percent Rank and Area for 1990 Permits Change 1 Riverside-San Bernardino 42,700 45,497 -6.1% 2 Washington, D.C. 34,900 35,338 -1.2 3 Atlanta 34,000 33,507 +1.5 4 Seattle 31,100 27,685 +12.3 5 Los Angeles-Long Beach 30,700 48,441 -36.6 6 Las Vegas 23,900 24,495 -2.4 7 Orlando 22,700 21,377 +6.2 8 Sacramento 22,300 20,696 +7.8 9 Chicago 22,100 20,919 +5.6 10 San Diego 20,500 18,710 +9.6 11 Detroit 20,200 20,447 -1.2 12 Baltimore 18,500 17,906 +3.3 13 Minneapolis-St. Paul 16,900 17,453 -3.2 14 Philadelphia 16,200 17,235 -6.0 15 Portland, Ore. 15,400 14,820 +3.9 16 Charlotte-Gastonia- 15,000 14,073 +6.6 Rock Hill 17 Ft. Lauderdale-Hollywood- 13,500 14,228 -5.1 Pompano, Fla. 18 Phoenix 13,500 13,474 +0.2 19 Tampa-St. Pete- 13,100 15,357 -14.7 Clearwater, Fla. 20 Orange County 13,000 16,797 -22.6

SOURCE: U.S. Housing Markets, 2153 Penobscot Building, Detroit, Mich. 48226; (313) 963-9441

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