Evening star. [volume] (Washington, D.C.) 1854-1972, 1878-01-25
The Depression in Real Estate.
HOW TO REMEDY IT

| action was taken.
The Depression i'm Real Estate.
HOW TO REMEDY 1T.
To Editor OF Erenilg Star: A few ObSerya-
tions on real estate in general, and in the Dis
trlct OF Columbia in particular:
J. What is real estate worth tO-ddH in com
parisOn with its prices between 1868 and 1915?
II. Why there are SO few private sales.
III. How to remedy the matter.
Real estate values since 1868, and perhaps
farther back and down to the present time,
have remained unchanged, if We reckon upon
gold basis; but upon greenback standard
the purchasing power of the greenback, and
the various local causes: or, to speak more
accurately, it simply follows the gold value of
the greenhack and the local causes. For eN-
ample, if gold was worth $l.25 in 1868, a house
which then was worth $4,000 in greenbackS
was really worth in gold only 81 800. But in
1877 greenback was worth 81 cents in gold,
se s beSs OF gSd I IN sois
today worth in gold $500 mot reckoning
local causes, of which we shall speak here:
aft.r) that is TO say, the purchasing power Of
greenback is twenty-five cents more on the
dollar than during the period between 1868
and -.
Now the local causes are reduction in the
cost OF building, materials and labor, forced
sales. &c. According - recognized tables the
cost of labor and building materials has fallen
since 1868 successfully from 10. 70, 40 and even
. per cent. especially in labor, SO that to-day
this cost is actually in nearly every section OF
he country seventy-iiye per cent less than in
1872 to 10: hence 1t follows logically and ire
sistihly: lst. That the value of lot of ground
to-day. compared with its value in 1868 or any
other time is simply the difference between the
value of the greenback of that time and the
greenback of to-day: OF course making the
necessary allowance for such local causes as
eXOrbltant prices. &c, &c. I'd. That a house
can now be built for from 30 to 70 per- cent less
this proposition appeal TO any builder i'll the
District of C0lumbia).
These local causes are chiefly innumerable
forced sales OF property under mortgages and
deeds OF trust: the withdrawal Of money from
circulation by capitalists, and the consequent
want of money among the business cOmmuni-
ties OF the country: and last, but not least. the
outrageous imitation of real estate generally.
After many years of careful study and OBJ
Seryatlon OF these principles and causes. | am
convinced that if we take fifty per cent dis
count from the values of real estate between
the years 1868 and 1879 as the present value OF
real estate, this discount of fifty per cent.
would still be too small. IT, then, we take fifty
per cent. as the true discount. these few brief
observations will show concluSively what real
estate is worth to-day i'll comparison with its
values between the years 1858 and 1873.
Now, why are there so few private sales Of
real estate? Simply because prOperty-owners
refuse to recognize and act on the principles
and observations above made. whichar really
elementary principles OF political economy of
he universal world since the days when trade
and commerce first began: principles upon
which every capitalist of any consequence in
lul1lNtN acts. DIfnciDiPS Wl1lcn almost every
person except real estate owners know
Strange to say. real estate owners are still
holding on. ''lrdttiRGf0r it to 30 up." 1t does
go up. but not in the way they expect. Owners
of encupbered property. initiating the eX-
ample of persons owning n1lencunabered real
estate, hold on. waiting for real estate 't0 40
up" finally, the circumference falls due they
a new loan Int fail hecai1Se real estate is not
worth by fifty per cent. what if was when they
made the encumbrance, and lenders want
lnr hon
nwSei,s nr6nertV sold under deed nj trmSt
bid in bv holder of notes for less than
amount OF Indebtedness. and he finally OBJ
tains Indictment aGai,nSt former oWner
for d;fferenre hetween original indehteGneSs
and amount of sale DonhfIess many personS
familiar With the nrincinleS ahove mentioned
nffareJ the nxner heforn tba amctinm sale the
ontnsi c o,S Zine Of To nrnnartV Int The
"Svnpr refnsed these Offers hhecauSe afbe nrnn-
crtn rort Inn mae tIn,, tbGt So he wait6J
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