
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, May 19, 1993                   TAG: 9305190026
SECTION: BUSINESS                    PAGE: B7   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

HOME BUILDING JUMPS

Builders began digging out of a winter slump in April, boosting construction of new houses and apartments by 6.7 percent, the Commerce Department said Tuesday.

The biggest increase in housing starts in seven months was shared by every region in the country except the Midwest, where they declined slightly.

Nationally, starts totaled 1.21 million at a seasonally adjusted annual rate, up from 1.14 million in March. It was the first increase since a 4.5 percent advance in December.

"Naturally, some of it was a rebound from the weather-related depression," said Martin Regalia, economist for the U.S. Chamber of Commerce. "But more fundamentally, the improvement in mortgage rates and prices combined to create increased affordability.

"Now if we can just sustain these improvements during May and June - the primary building periods - we can lay the foundation for the second half of the year."

Wet weather continued to plague construction in some parts of the country and helped keep the pace below December's 1.29 million rate.

"There was really pretty soggy conditions in the Northeast and the Northwest," economist David F. Seiders of the National Association of Home Builders said. "Builders need solid ground to put in foundations."

Still, it was the largest increase since an 11.1 percent gain in August. Analysts had expected starts to advance about 6 percent.

During the first four months of 1993, starts sank 2 percent from the 1992 period. They fell 8.9 percent in January and a revised 3.6 percent in March. Construction edged up 0.8 percent in February.

David Lereah of the Mortgage Bankers Association said he was encouraged that the increase in starts was broad-based geographically.

They shot up 22.6 percent to a 114,000 rate in the Northeast, 9.5 percent to a 542,000 rate in the South and 3.4 percent to a 305,000 rate in the West. They fell 0.8 percent to a 252,000 rate in the Midwest.

Applications for building permits - a harbinger of activity to come - also rose in April.

Permits were up 5.8 percent, to a 1.09 million rate, the largest increase since a 7.8 percent advance in December 1991.

by CNB