SAN FRANCISCO - With memories of the recession and real estate bust of the early 1990s in mind, bankers and analysts are warily monitoring a boom in real estate lending and looking to technology stocks as a possible harbinger of an eventual downturn.

Fueled by the rapid expansion of Internet companies and the stock market wealth they have created, housing and commercial real estate prices in several markets, particularly in California, have been on the rise for the last several years. Bank lenders who specialize in commercial and residential real estate said there are only the slightest hints that the growth is abating.

Even so, volatility in tech stocks, whose surging prices fueled explosive growth of real estate values in areas like San Francisco and Silicon Valley, has sent shivers through the local community, banks that finance development, and analysts whose job it is to catch signs of credit problems.

A heightened perception that the real estate market could bubble out of control has led some to counsel caution. "The crucial question is: What is the sensitivity of the local real estate market and labor market to the volatility of the Nasdaq?" said John Krainer, an economist at the Federal Reserve Bank of San Francisco.

Banks in the region rely heavily on real estate lending, with community banks in the state among the most active in the business, analysts said. Campbell Chaney, an analyst at Sutro & Co., estimates that 20% to 25% of the loans made by California banks go toward residential and commercial real estate. He also estimates that between 40% to 50% of banks' total loan portfolios are secured using real estate as collateral.

Out-of-state institutions, like Washington Mutual Inc., are also exposed, analysts said. Close to 100% of the entire portfolio of Seattle-based Wamu is in residential, commercial real estate or manufactured housing, and over of a third of its business is in California, said analyst James Bradshaw of D.A. Davidson.

Some bank lenders are moving to protect themselves. Paul Nakae, a senior vice president in construction lending at Bank of the West in San Francisco, said he has been more careful when considering financing a commercial project that will rent to Internet companies.

Some of that extra consideration translates into requiring a heftier down payment from the borrower. For one large office project in San Mateo County, where many tech companies have their headquarters, a project developer is contributing $100 million in equity, or 30%, of a project that will cost $350 million.

The terms are stricter than if the planned tenants were not Internet or related companies, Mr. Nakae said. For non-dot-com firms, banks financing real estate projects would typically require a down payment from the developer closer to a range of 15% to 20% of the project cost, Mr. Nakae said.

For now, at least, real estate prices have yet to weaken to the degree stock prices have.

In March, when the Nasdaq was already beginning to swing close to 200-point drops in one day, median home prices in the San Francisco Bay area increased almost 10% from the previous month; prices in Santa Clara, in the heart of Silicon Valley, rose 12.6% for the same period.

While no one is sounding alarm bells yet, fear that a an early 1990's-style real estate collapse, which left banks in California weakened by large bad loan balances and caused the demise of several thrifts, hangs in the air.

G.U. Krueger, an economist at the California Association of Realtors in Los Angeles who released a report last week on the "worst case scenario" if a real estate crash were to follow market instability, agrees that there has been a shift in sentiment in Northern California over the last two months.

While the association has not seen any signs yet of an impending burst, "the enthusiasm is gone," he said. That has resulted in a "normalization in the housing market," and a decline of some of the excesses, like double-digit bids for a property, he said.

Ann-Marie Williams, research services manager in the San Francisco office of Grubb & Ellis Co., a commercial real estate broker, said rumors are cropping up that prospective tenants are slowing down their search for space.

But so far, the momentum in the San Francisco rental market has not let up. Already, about 60% of the 2.2 million square feet of office space slated for 2001 has been leased.

Precautions against a drop in the real estate market in "hyper-drive" is nothing new for the region's banks. Mr. Nakae said that for the last 18 months his bankers have been holding their loan to value ratios at 50% for construction lending. That way, "If rents dropped in half, we'd still be okay," he said.

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