The Washington metropolitan area, bucking a nationwide trend, joined New York as one of the top locations for new apartment construction last year, according to a recent 45-city survey of multifamily building permits.

But local building experts contend that the sharp increase will not be sustained this year as an overbuilt market catches up with demand, particularly in Fairfax County.

The number of permits issued for multifamily housing -- rental apartments and condominiums -- in the Washington area jumped 42 percent last year, from about 9,700 units to about 13,800.

Last year's projected permit figure is the highest for the Washington area since 1973, when about 17,000 new multifamily permits were issued.

Washington's stable economy and low unemployment, bolstered by the presence of the federal government, were cited as reasons for the sharp increase by U.S. Housing Markets, a quarterly report published by Lomas & Nettleton, a Dallas-based mortgage banking firm.

Nationwide, new multifamily construction fared much worse, as developers found themselves building apartments in extremely overbuilt markets. Although December permit figures are not yet available, the report predicted that 510,000 multifamily permits would be issued nationwide last year, a drop of 26 percent from 1986.

Moreover, with last year's tax reform package taking away attractive incentives that were warmly embraced by developers in the past, builders no longer found themselves able to justify new multifamily construction in overbuilt markets.

High multifamily permit levels in 1985 and 1986 can also be attributed to tax reform, or more precisely the prospect of tax reform: Builders saw the revisions coming, and many constructed their projects prior to implementation of the new law.

In otherwise healthy areas such as Los Angeles, Phoenix and Tampa-St. Petersburg, tax reform and overbuilding led to the severe drop in new multifamily construction, according to Virginia Knight, a researcher for U.S. Housing Markets.

In Los Angeles, the number of new permits nose-dived from 53,595 in 1986 to a predicted 35,600 last year. Apartment permits in Phoenix fell from 19,080 in 1986 to 9,100 in 1987, while the Tampa-St. Petersburg area's permit level dropped 34 percent.

Other areas still reeling from devastated economies, such as the Oil Belt, also saw a sharp drop in multifamily starts. New permits in the Dallas-Fort Worth area plummeted 81 percent last year, from more than 21,000 to about 4,000. Denver and Austin, Tex., also suffered, with 46 percent and 80 percent drops, respectively.

Houston, which was booming prior to a drop in oil prices, is still suffering. Only 400 new multifamily permits were projected by the end of 1987, according to the report, down from 896 in 1986. By contrast, new multifamily permits there in 1982 totaled about 45,000.

Atlanta's permit figure fell from 18,400 in 1986 to a projected 12,500 last year. In Baltimore, about 3,500 permits were issued last year, down from 4,000 in 1986. Chicago, Detroit and San Francisco also saw sharp decreases. Philadelphia was down slightly, according to the report.

Of the 45 cities examined in the report, only 11 areas showed gains in multifamily permits last year. Most of those increases were modest.

Aside from Washington, cities with permit increases of greater than 10 percent last year were New York (up 22 percent), Charlotte, N.C., (up 26), Cincinnati (up 20), Las Vegas (up 20) and Seattle (up 13).

Multifamily permit figures in the New York-Long Island area rose from 10,600 in 1986 to a projected 13,000 last year.

Tom Bozzuto, regional partner with the Oxford Development Corp., a national apartment building firm based in Bethesda, was less optimistic about any increase this year in new multifamily housing starts in the Washington area.

"There has been a national perception that the Washington market is very healthy," he said. "The result has been a tremendous increase in the number of starts. This increase is going to put the Washington market into much the same overbuilt market being experienced in the rest of the United States."

Consequently, Bozzuto said the Washington area can expect to see "substantial reductions" in the number of new multifamily construction projects started this year.

He said the District of Columbia will continue to have little new apartment construction because of the city's rent control law, even though the strict rent caps do not affect new buildings.

"There's still the fear that the District could quickly turn around" and impose the rent control laws on new buildings, he said.

Bozzuto, in explaining the oversupply of multifamily units in the Washington area, pointed to a rapid influx of residential construction firms entering the market here as they flee financially strapped areas, such as Texas and other troubled states.

In addition, Bozzuto said that a softening in the Washington area's commercial construction market, particularly in the suburbs, has turned the eyes of an increasing number of office builders to residential projects.

"There is a potential for a serious oversupply {of multifamily units} in the short run," Bozzuto said. "But in the long run, Washington is still one of the best markets in the United States."