REAL ESTATE

Building Slump: The real estate slump continues: Contracts for future construction dropped 20% through October in Orange County.

F.W. Dodge, a division of McGraw-Hill that tracks construction contracts, estimates that only $1.9 billion worth of contracts had been let through the first 10 months of the year.

That’s down from $2.4 billion during the same period in 1989, Dodge says. The biggest drop was in residential building, which was down 24%, from $1.3 billion last year to $978 million this year.

Home builders have constructed far more expensive homes in the county than the market can absorb. And even those builders who are putting up less-expensive homes often say they can’t get financing to build now that lenders and the government agencies that regulate them are edgy about the real estate market.

Non-residential building contracts hadn’t dropped quite as much as residential through October, Dodge reported, off only 16% from $1.1 billion last year to $910 million this year.

Office buildings, in particular, are overbuilt in Orange County, and developers say they face the same problems borrowing money as do the home builders.

The drop seems to be accelerating recently. In October alone, contracts dropped 54% to $112 million from $242 million a year earlier, Dodge estimates.

That breaks down like this: Residential construction was down an estimated 66%, from $124 million to $42 million; non-residential was down 40% from $117 million to $70 million.