Gypsy moth and cicada damage to trees in the Washington area has increased significantly this year, threatening the property values of many homes, local officials warn.

Nate Bacon, program coordinator for Fairfax County's gypsy moth office, said that more than 75 percent of the county is infested with the moths, which in their caterpillar stage eat the leaves of oaks, hickory and other hardwood trees.

And the problem is getting worse, he said. According to his estimates, 20 times as many trees in the county will suffer defoliation from the moths this year compared to last year.

"Phone calls from homeowners were averaging 20 per hour at one point," Bacon said. "And right now we're getting quite a few phone calls from people reporting seeing moths laying eggs," he added.

While many people are aware of the defoliation of trees this summer, Bacon said some have confused the damage done from gypsy moths with that caused by the 17-year cicadas that hatched this spring. Bacon said that cicada damage is marked by dead twigs at the tip of tree limbs while gypsy moth damage is evident as bare tree limbs.

Fairfax County isn't the only area experiencing an increase in gypsy moths, which were first noticed in the Washington area in 1980. Bob Tichenor, chief of forest test management for the Maryland Department of Agriculture, said the gypsy moth population in Montgomery and Prince George's counties has skyrocketed as well, particularly in Montgomery's northern sections as well as in older areas such as Bethesda, Silver Spring and Takoma Park, which have more oaks, the moths' favorite food.

Even in Loudoun County, where the black, one-inch to two-inch moth caterpillars stripped 7,000 acres last year, 3,000 acres of trees have been defoliated this year even though county officials sprayed 12,000 acres with pesticide, a 50 percent increase from 1986. "About the only area it hasn't moved into is the southern part of P.G. County," Tichenor said.

The gypsy moth was first brought to the United States in 1869 by a New Bedford, Mass., botanist who was going to crossbreed them with silkworms. But the moths escaped and have been spreading since then, stripping entire forests in the Northeast, said Donald Kludy, state entymologist for the Virginia Department of Agriculture.

While the cicada damage is unslightly, botanists say it does no permanent damage to mature trees. The invasion of moths, however, has threatened the value of homes in areas infested with the insect because the caterpillars can quickly defoliate untreated trees and weaken them enough so that they often die after a couple of years.

Robert Feilix, executive vice president of the National Arborists Association in Bedford, N.H., said gypsy moth infestation can reduce property values by as much as 20 percent if a significant number of trees on a lot die. Ruth Salvaggio, gypsy moth coordinator for Montgomery County, said a healthy, mature oak can add up to $10,000 to a home's value. "People should consider gypsy moths when they look at a home to buy," Salvaggio said. "Appearance counts a lot" and losing a tree is a significant financial liability, she added.

Michael DeChant, a Rockville real estate appraiser, disputed that a stripped tree could decrease a lot's value by that much. "Certainly landscaping has a big impact, but not that much, he said.

DeChant said appraisers typically take into account how much it costs to remove dying trees, which some area arborists say can average around a $1,000 per tree. That cost, and the cost of replacing the tree, is then subtracted from the assessed value of a home. Guy Turene, an arborist for Montgomery County, said the Internal Revenue Service typically estimates the value of a tree at $23 per square inch for the diameter of a tree four feet above the ground.

Others, however, say that a mature oak tree is valuable because it is nearly irreplaceable.

"Unfortunately, an oak is something you can't replace," said Tichenor. "If you lose a shrub, it's easy to replace, but if you lose a 75-foot oak tree, you can't replace it, at least for a couple of generations." Real estate agents also say that wooded lots are generally much more valuable than lots with only shrubs or open land.

Real estate agents here say they haven't seen a big impact on the market this year despite the proliferation of gypsy moths. Patti Toennisessen, a vice president of Coldwell Banker Realtors in McLean, an area with a serious gypsy moth problem, said she has "heard of people turning down deals because it's apparent that there is a lot of tree damage" in the past.

But "it's been a seller's market this year. There are very few listings on the market. Buyers are overlooking not just tree damage, but other defects as well in many cases" so that sellers will accept their offers, she said.