The housing industry, which outperformed predictions in 1977 to reach an all-time high of 1.5 million single home starts, is expected to decline moderately in 1978, industry sources agree.

Total starts in 1977 are expected to total 1.97 million, but composite forecasts place the 1978 figure between 1.7 million and 1.8 million units.

Significantly, all of the decline is expected to be in detached house starts, a sector that hit a record level nationally this year and increased to nearly 18,000 in the Washington metropolitan area for 1977. Housing economists expect detached house starts to fall to 1.2 million or 1.3 million in 1978, while apartment starts are expected to increase.

For the metropolitan area, forecasts call for increases in both single house and multi-family starts.

Michael Sumichrast, chief economist and vice president of the National Association of Home Builders, predicts that housing starts nationally will total 1.8 million, while Washington area starts will rise from an estimated 25,249 in 1977 to about 28,000 next year. Most of the increases is likely to be in single family units, he said, which more than doubled in 1977 from 1975 figures.

The 1978 growth expectations are seen as a continuation of the record performance this year. A year ago, economists' consensus on the 1977 housing outlook set housing starts at about 1.7 million, a figure that proved to be conservative, That early forecast, however, represented an optimistic view compared with the 1.5 million starts for 1976 and the 1.16 million units begun during construction-depressed 1975.

The scope of the housing boom is regarded as remarkable in light of the continuing shortages of labor, lumber, insulation and drywall materials. But prices rose dramatically this year, reflecting those construction industry problems. New housing prices climbed about 16 per cent in 1977, according to industry figures, while the resale market saw prices increase about 10 per cent above the record 1976 values. The resale market enjoyed a rise in sales to about 3.5 million this year.

Housing economists credit the real estate upturn to increased consumer confidence in the investment value of homes, tax advantages of home ownerships, the easier availability of mortgage money and an acceleration in so-called new household formations.

M.R. Robinson, a building research specialist for Professional Builder magazine, pointed out recently that the number of new households climbed to 1.5 million in 1977 from 1.4 million in 1976. He predicts the number will reach 1.6 million in 1978. The gains, he said, reflect the maturing of the babies born during the postwar population boom. Now this generation of Americans are buying homes and condominium apartments.

Robinson joins Sumichrast in forecasting a drop in single housing starts next year to about 1.2 million units. But he also expects an increase in multi-family construction and two-to-four-unit residential buildings. Apartment starts should exceed 500,00 he says, and more attached, cluster homes may be built in urban areas. Evidence of the latter trend is seen in many sections of the District and nearby areas, such as Old Town Alexandria and Falls Church.

Although there is evidence that the level of net new savings declined in 1977 in savings and loan association deposits, U.S. League of Savings Associations' economist Kenneth J. Thygerson insisted recently that the federal impetus for multi-family starts will keep the level of 1978 total housing starts near 1.9 million.

Yet his boss, association executive Normal Strunk, said here this week, "We expect that savings flows will be down somewhat next year and that will make mortgage money a little tighter and a little more expensive."

In 1977, conventional mortgage lending for houses from savings and loans is expected to reach a record of $100 billion.

The most optimistic of the forecasters is John C. Opperman, newly elected president of the Mortgage Bankers Association. The San Franciscan recently predicted 2.1 million starts in 1978 as the result of increasing consumer confidence, household formations, new urban construction, availability of mortgage money and high employment.

A veteran housing professional here also pointed out recently that the passage of an income tax reduction bill in the next session of Congress could give further strength to the 1978 housing market.

Most housing experts expect a continuing demand for homes and condoninium units next year, but they fear a tightening of the availability of mortgage money in the second half of 1978. Some observers expect interest rates to increase 0.25 to 0.5 per cent above the current 9 to 9.25 per cent levels.

Sumichrast, who joins those economists forecasting a second half downturn, said, "If nothing else, the kind of mild decline will straighten out some of the supply and labor problems we have been experiencing."

In the area housing market, which is expected to produce larger totals in 1978 than in 1977, there is some apprehension about 1978 among major builders and lenders - but also a recognition that the red-hot consumer interest in home ownership could expand.

Area builders are concerned about the supply of mortgage money in 1978. Their anxiety is shared by savings and loan executives who support the forecasts of declining savings, slightly higher lending rates and less available money for home loans in the latter part of the year.

There also is some concern about overbuilding in Northern Virginia, which has been the scene of most of the area's new construction in recent years, according to one major builder. But Martin Poretsky, new president of organized suburban Maryland builders, noted that buyer confidence is strong and many builders have a backlog of sale contracts through spring. Poretsky did not downplay the concerns about mortgage money uncertainty and the fears that a high rate of new construction and strong resales could outrun real consumer demand, however.

The significance of the recent upturn in area home building is evident when starts are reviewed. In 1975, the total was 9,554, consisting of 7,230 single houses and 2,324 multi-family. In 1976, the figure rose to 16,845, of which 13,583 were singles and 3,262 apartments. In 1977, the estimated total of 25,249 will be broken down into 17,899 singles houses and 2,324 multi-family. In 1976, the figure rose to 16,845, of which 13,583 were singles and 3,262 apartments. In 1977, the estimated total of 25,249 will be broken down into 17,899 singles and 7,350 apartments. Next year, the total forecast of 28,000 new units in this metro area is expected to include 20,000 single houses and 8,000 apartment units.

This area hit an all-time high of 55,000 housing starts in 1965 - but nearly 80 per cent of that total was in multi-family construction. Another healthy year for construction. Another healthy year for construction was 1972, when total starts hit 42,183. It might be noted that the housing patterns are cyclical in terms of two-to-three year high periods followed by several years of low production.

In the District, where new residential construction, rehabilitation and resales have been strong in the past year, the trend is expected to continue. Several hundred new units are expected to be built at the Fort Lincoln new town and hundreds of new homes and apartments are planned in Southeast.

Rising costs of housing and travel distances are bothering builders and developers in suburban areas, some of which hve been losing prospective buyers to in-city rehabilitations and new houses.

C. G. (Gus) Yeonas, head of a large home building firm that expects to build nearly 900 houses next year, said many new building sites will be closer to the city. However, he noted that a subdivision of single houses priced in the $60,000 range recently sold out quickly in the Centreville area.

"We are all disturbed by rising costs, and particularly by the cost of raw ground with lots in the $16,000 range and finished lots at the level of $25,000 to $30,000," Yeonas said. "Those prices dictate high prices for the houses that are built on those lots. Available lots are overpriced, and I fear a replay of 1972-73, when there was overbuilding."