Mortgage interest rates, now relatively low at about 8.5 per cent across the nation, probably will turn up slightly before the end of this year and close at or slightly above the early 1977 level of close to 9 per cent, Federal Home Loan Bank Board Chairman Garth Marston predicted this week.

Speaking to more than 200 area mortgage bankers at the Mayflower hotel, Marston described the current mortgage money market as "not skitterish, as it was in January and February."

In discussing the local market, he asked his audience about the availability of mortgage money for apartment loans, rehabilitation and new-homes purchases.

William Blumenauer, president of Columbia Federal Savings and Loan Association, said plenty of mortgage money is available locally for new-home and rehabilitation loans. But Blumenauer added that "the numbers do not work out" for developers on most apartment construction loans. Another listener cited rent controls as the reason for lack of lender interest in multi-family loans.

Other observations by Marston:

The "affordability gap," with housing priced higher than some potential buyers can afford, is a "problem but not a crisis." And Marston hopes that Congress will not "throw money at the problem" because he sees general inflation as the major cause. The "gap" is a serious problem mainly for first-time prospective home buyers and low-income families, and should be dealt with on that basis, rather than for all middle-income Americans.

Fewer persons today are buying a home because of the traditional urge to acquire personal shelter, and more are regarding the purchase of a home as an investment.

Mortgage loans are covered by 208 pages of federal regulations, which Marston called "excessive." He added that it now generally takes 70 minutes to fill in an application for a mortgage compared with 15 minutes not long ago.

There's no reason why a consumer should not have a choice of mortgage plans, including those featuring variable interest rates and others differing from the standard plans with their fixed interest rates and fixed monthly payments. This change is coming, he said.