Home costs are becoming a little easier to live with

Affordability is making a comeback. After several years of escalating housing prices and mortgage rates, housing costs have dropped considerably. A recent quarterly survey by Advance Mortgage Corporation of Detroit indicates that homeowning costs are indeed becoming much more manageable.

Mortgage payments have declined significantly, particularly in the Federal Housing Administration-Veterans Administration sector. The average FHA mortgage payment was $117 lower during the fourth quarter than during the first three quarters of 1982 - declining from $742 to $625, which means that 8.25 million more households were able to qualify.

The average conventional mortgage payment slipped $58, from $925 to $867. The average closing rate for the mortgages declined 1.32 percent, from 15.07 percent to 13.75 percent.

Location, of course, significantly influences housing costs. Overall, Philadelphia has been the winner for most-affordable housing, with conventional mortgages never taking more than 30 percent of income, and FHA-VA payments absorbing 15 percent of earnings. The average price of a conventionally financed home was $65,100 in the fourth quarter of 1982.

St. Louis is most affordable for conventionally-financed mortgages, with payments averaging 24 percent of income. The average home cost $64,100.

San Diego ranks as the most expensive market, with homes costing, on average, percent of income, although this is down from 54 percent in the first three quarters of 1982. New York City, Los Angeles, the San Francisco Bay area, and Portland, Ore., were also high, with payments accounting for 40 percent of income.

Boston still has above-average interest rates and the highest taxes of any city in Advance Mortgage's survey, but low home prices have kept the payment-to-income ratio in the low 30s. In the greater Boston area, the average home price ran $74,300.

The issue of affordable housing is one of growing concern. Professional Builder magazine launched a campaign in September 1982 to spur builders to develop homes that were priced at or below the area average and were less than 1 ,500 square feet in size.

Response, according to Roy L. Diez, editor in chief of the magazine, has been ''fantastic.'' Mr. Diez reports that the competition, which focuses on good design, value, and proven success in the marketplace, has drawn 500 entries.

Building smaller homes is definitely the name of the game for residential builders.

Along with cars, computers, and appliances, houses are shrinking. And for all singles, childless couples, small families, and ''empty nesters'' whose grown-up children no longer live with them - and these groups constitute a growing part of the population - this trend toward ''smaller is better'' is welcome. ''Most builders who have been building large houses are finally waking up to the loss of that market,'' asserts Zane Yost of Zane Yost & Associates Inc., in Bridgeport, Conn. Mr. Yost says 70 to 80 percent of all houses built in 1983 will be between 1,000 and 1,500 square feet. Yost also points to the large market for condominiums and townhouses.

Smaller houses are not new. In the 1950s, Yost says, the typical house was 1, 000 sq. ft. or smaller. Now, with a more mobile population as well as shrinking families, smaller houses are in demand once again.

The trend toward smaller housing does not necessarily mean significantly cheaper housing.

Don Parmiter, senior vice-president at Robert Charles Lesser & Co., a market research firm in Beverly Hills, Calif., says that builders are enthusiastically going after the first-time buyer as well as the so-called empty-nester market with smaller houses. But he questions whether this means more good buys.

''Nationwide, buyers need to have an income over $30,000 to buy the housing they want,'' he claims. Price, of course, depends on location. An affordable house may not be well located, he says, and so couples will continue saving and renting until they can afford to buy in the area they prefer. Still, expectations everywhere should not be high, since, Mr. Parmiter adds, ''even $ 120,000 will not buy a lot of house in Los Angeles.''

Zane Yost concurs, warning that ''you can't save tremendous amounts by making houses smaller,'' and noting that land and regulatory costs are a major factor in housing prices.

Higher-density housing in many cases is the answer to less expensive housing, although some communities resist such efforts.

There are steps some homeowners can take to reduce their own costs.

Mr. Parmiter points out that many municipalities are changing zoning rules, for example, to accommodate such things as room rental in single-family homes, or so-called ''granny flats,'' usually a separate apartment or a small house on a lot formerly restricted to just one home.