Homes sales in county look to be on the rise for first time since 1988.

Home sales in Los Angeles County are projected to increase by 13 percent this year, the first yearly gain since 1988, according to a study by TRW REDI Property Data.

L.A. County home sales are projected to reach a total of 81,763 units this year, compared with actual home sales of 72,217 in 1993, according to a study by the Riverside-based real estate information service.

So far, in the first seven months of 1994 there were 47,695 homes sold in L.A. County.

The projection of 81,763 home sales is based on the assumption that home sales will continue at the same rate throughout the remainder of the year, said Nima Nattagh, TRW REDI market analyst. The projection also assumes that recent rises in interest rates will have a "significant negative impact" on home sales.

The study may be "a little bit optimistic," said Warren Heller, a Ph.D. in systems analysis and head of research at Veribanc Inc., a Wakefield, Mass.-based bank research firm. "It's been demonstrated strongly that people don't take out as many mortgages when the rates are high."

But Nattagh noted interest rates are still significantly below levels in 1989, when the California residential real estate market hit its peak. The average 30-year fixed rate mortgage for the first six months of 1994 was 7.98 percent, compared with 10.32 percent for 1989.

Statewide, TRW REDI projects that home sales will increase 7.5 percent this year to 378,000 units from 351,663 actual home sales in 1993.

Despite the projected uptick in statewide home sales, the projected 1994 volume would still be one-third below 1989 boom levels, when 566,000 homes were sold in California.

Meanwhile, another TRW REDI study found housing affordability is at a higher level than three years ago both statewide and in L.A. County.

The study created an affordability index, which measures mortgage payments as a percentage of average income.

Statewide, average mortgage payments consumed 43.9 percent of the average income in the first six months of 1994. This compares with an affordability index of 46.5 percent in 1991.

In Los Angeles County, average mortgage payments ate up 43.2 percent of the average income in the first six months of 1994. That compares with 53.1 percent in 1991.

Nattagh noted that statewide, the mortgage outlays have been "fairly stable," while there has been a "marginal improvement" in income levels. At the same time "interest rates have dropped," he said.

Home affordability has increased more sharply in L.A. County than statewide because home prices have dropped more here, Nattagh explained.

Flat or declining home prices, declining interest rates and increases in income have also contributed to the increase in home sales in L.A. County and statewide, Nattagh said.

In 1994, the least affordable of California's 47 counties in housing-payment terms is San Francisco, where the average mortgage payment represented 54.1 percent of the average income.

The next least affordable places to buy a home are Monterey County with an affordability index of 47.4 percent; Santa Cruz County, 47.2 percent; Santa Barbara County, 44.3 percent; and then L.A. County, 43.2.

The most affordable county in California is Siskiyou, where the average person spends 24.6 percent of average income on the average mortgage.

The second most affordable California county is Lassen where the affordability index is 25.4 percent, followed by Trinity County, 27.2 percent; Shasta County, 27.5 percent; and Kern County, 28.5 percent.