Home Building Off 0.1%; Strong Year Predicted

WASHINGTON — New home construction slipped a smaller-than-expected 0.1% in January, the government said today, bolstering predictions that 1987 will rank among the decade’s strongest years for home building.

The Census Bureau also said the number of building permits issued in January fell 11.6%, the biggest drop in nearly three years, but officials dismissed the fall as an aberration brought on by a change in permit fees in California.

New homes were built last month at an annual rate of 1.806 million, about 0.1% below December’s 1.808 million, the bureau reported.

Last month’s annual rate of housing starts matches the number of homes built in all of 1986--the best year for new housing since 1978’s 2.02 million starts.

Jim Christian of the U.S. League of Savings Institutions said the figures “leave me smiling,” while economist Dave Seiders of the National Assn. of Home Builders called the report “a good, solid housing picture.”

But Christian and Seiders joined Richard Peach of the Mortgage Bankers Assn. in warning that every month in 1987 will not be quite as good as January.