Survey Logs 4th Quarterly Gain for Real Estate : Economy: Bank regulators nationwide reported improved local market conditions--except in California.

The nation’s real estate sector posted solid improvements for the fourth straight quarter, but California remains markedly weaker than elsewhere, according to a survey of bank regulators released Monday.

The Federal Deposit Insurance Corp., which conducts a quarterly survey of market conditions, said more commercial real estate markets began to latch on to the recovery in the three months ended in October. And it said the excess supply of homes and buildings left from earlier overbuilding was cut.

The FDIC questioned bank and thrift regulators about local real estate conditions. More than 450 participants were polled in late October about developments in the previous three months.

The agency said the index it uses registered 67 for the latest period, the same as in July. A reading above 50 indicates that more respondents thought conditions were improving than declining. A reading below 50 indicates the opposite.

The October and July readings were topped only by the 72 reported for May, 1992. The survey was started in April, 1991.

“This survey marks the fourth consecutive quarter in which solid gains were registered,” said William Watson, head of the FDIC’s research division.

Almost 60% of those surveyed said housing market conditions were getting better, while less than 10% said conditions were worsening. Nearly 70% reported that home construction was at average or above-average levels.

Nearly a third of the respondents reported improvements in their local commercial real estate markets--the highest proportion to date.

Respondents reporting excess supplies in commercial real estate fell to 75% from 82% in July. The figure had hovered around the mid-80s since July, 1991.

Outside of California, only 12% of those surveyed said commercial real estate prices had fallen.