The Virginian-Pilot 
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1995, Landmark Communications, Inc.

DATE: Saturday, January 21, 1995             TAG: 9501210162
SECTION: BUSINESS                 PAGE: D1   EDITION: FINAL 
SOURCE: BY MYLENE MANGALINDAN, STAFF WRITER 
                                             LENGTH: Short :   47 lines

U.S. HOUSING TREND BYPASSES REGION HAMPTON ROADS DOWN: PRELIMINARY REPORTS SHOW THAT NEW-HOME CONSTRUCTION DECLINED

Although the Commerce Department reported Friday the highest level of housing starts in six years, the federal agency's numbers don't reflect the story in Hampton Roads.

Fewer permits were issued for new-home construction here in 1994 than the previous year, according to preliminary estimates by Robert W. Lyons, executive director of Builders and Contractors Exchange Inc.

``For the last six months in this area, the year-to-year comparison has been down,'' he said.

Final 1994 residential building permit information from all of Hampton Roads' main seven cities was not available. But the cities that have reported so far show an overall decline for the region. Building permits are the best local indicator of future building activity.

Chesapeake issued 1,979 residential permits in 1994, down from 2,329 issued in 1993. Through November of 1994, Virginia Beach issued 1,283 permits, or 285 fewer than in the same period in 1993. Suffolk and Norfolk are up for the year, but Hampton, Newport News and Portsmouth show overall declines through November.

The dollar value of residential permits for the region through November 1994 fell almost $25 million below the same period in 1993, Lyons said.

Permit dollar values stayed ahead of 1993 levels through July 1994 but reversed direction in August when they fell $5.5 million below the same period in 1993.

Lyons suggested that the wet summer may have dampened construction activity during the middle of the year and that successive interest-rate increases by the Federal Reserve may have spooked builders.

From August 1994 to November 1994, both the number and dollar values of permits fell below 1993 levels, with the spread in dollar values increasing each succeeding month.

Local housing-start information for December should be available in the next week.

KEYWORDS: HOUSING CONSTRUCTION by CNB