Seekers of an investment hedge against inflation are producing a "sort of smart-money home-buying" that contributes to the esclation of prices and to the cost of financing. Sen. Charles McC. Mathias Jr. (R-Md.) told Baltimore homebuilders recently.

"Well-educated, upper-middle-class income people, unlike their parents, are not simply looking for a modest home, a place to raise a family," Mathias told the Baltmore County Home Builders Association.

Mathias decried the lack of pesonal savings being done by U.S. consumers who are "going deeper and deeper into personal debt.

The Maryland senator pointed out that the typical home-buying household has changed considerably since post-World War II. In those days, the typical household had one wage-earner, often a veteran, and purchased a modest home.

"Today's home buyers -- those lucky ones who can afford to buy -- are two-earner families, childless couples, seeking relatively spacious homes overflowing with amenities," he stated.

While pointing to soaring mortgage interest costs and property taxes as major "obstacles to home owning," Mathias said that the demand for housing for young, moderate-income families with children is not being met. He warned builders that "if the cost squeeze continues . . . you may find your market disappearing as young couples double up with their parents and other families double and triple-up, as is common in non-Western countries."

Mathias also urged builders to adopt cost-cutting techniques such as lowering ceilings, using preassembled rather than site-assembled plumbing systems and using full wall-height doors. He also suggested the use of wood foundations instead of concrete and other construction techniques that he said could reduce the cost of an average home by $1,946.