Rise in Home Permits Signals Builders’ Optimism : Construction: While heartening to industry leaders, the March increase falls far short of the levels of past years.

Apparently expecting a surge of home buying activity later this summer, county home builders geared up by pulling more residential construction permits in March than in any month since September, 1990, according to a report issued Tuesday.

Builders took out permits for 719 homes and apartments in March, up from 313 in February, with most of the permit activity in Laguna Niguel, Rancho Santa Margarita and other unincorporated county areas south of Irvine, the Construction Industry Research Board said.

Permits are typically obtained several months before construction begins.

While heartening to industry leaders, the March increase fell far short of bringing 1991 into line with past years. For the first quarter, builders were issued permits for 1,161 new residential units in the county, down 62% from 3,049 in the first three months of 1990 and off 67% from 3,579 units in the first quarter of 1989.

“It’s hard to get too enthusiastic with just one month of improvement,” said Philip Bettencourt, a housing consultant and president of the Building Industry Assn.’s county chapter, “but there have been some encouraging signs out there, and these numbers add to them. The inventory (of unsold new homes) is coming down, and I think that builders who are well capitalized are finding some good deals on land and have started pulling permits in anticipation of future demand.”

But Bettencourt said the industry generally expects 1991 to be a slow year for Southland home building.

Banks and other construction lenders “will be so cautious that they will lose loan business rather than make loans and look (to bank regulators and to investors) like they are getting too extended into real estate again,” he said.

In a positive sign for future buyers, single-family homes accounted for more than half the March and first-quarter totals.

During the the last half of 1989 and most of 1990, when average prices for new houses routinely topped $300,000 in the county, far more permits were issued for less-expensive apartments, condominiums and townhouses.

But by reducing home sizes, increasing density and eliminating many frills, builders have held down prices and may again be focusing their efforts in that market, industry observers say.

Permits were issued for 403 single-family units in March, more than double the 198 issued in February. For the first quarter, builders in the county obtained permits for 673 single-family units, down 36% from the first three months of 1990.

Housing Permits Builders took out permits in March on more than twice as many residential unitsas in February, but the total number of permits issued in the first quarter is only 38% of that in the year-ago quarter. 1990: 1,223 1991: 719 Source: Construction Industry Research Board