The sun. [volume] (New York [N.Y.]) 1833-1916, 1906-06-14
rHg REAL ESTATE MARKET
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lNIagROt ~ %PROPEHft
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me 10 Alas ttstHa affteH w FSeess

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An u]easually Istse rtoreftiee ~ 'be asr
l1sl thai IL faiNe lbysstsi In fsal es'ais luat
vsW 10 ring lN'o vsrtni ltNi ftrHiiNe In
|sBifbbfrvFi pfntHffv ms lNderH heen 4
nNtatlN feaiufs n tho maftei fof = nufutef
~ fuafa ftst, wv, n haa hrvet hrfrfN trrn
rnodufisi IN ~ letas = srale ~ II v nee
The prrscni drHlipe fusthstrrfe. diNsfs
Wiielv IN ehattctcf from that which has
oNtaiNsl iH fecrn' vetrs n affects q 'r'teh
Mrast yatiriy ~ land arl IA ahatel w a
rev tlpss " buyers
t'ntil lhis sintrrt Tho hulk ~ tho tfadtha
IN vacant rt'i~riy hFer'nd lnia Hv1ilahl"
tor Immediate Improvement, and wts sup
pori~d principally Wv h,iliiua lnHN orrta'
trrs and by speculative hu'liofs t'adinR
NJ this description IL Elm active, though
evidently not gaining w volu'ro Tho
chief movement, borrower. il in land Nutsids
Tho mnin nrrts ~ current huilding activity,
and tho pirohtsNrs arr trnrlo ~ ANAL
means. tho ma iori'y n whom nrr huvtnR
for a rise
Though called investors, 10 distinguish
them from professional operators and To
emphaslso tho fact that their purchases arc
Temporarily a. lenot. Withdrawn FROM the
market, most NJ tho buyers in qhestioh ar"
virtually Operating" in vacant and. Tho
motive Of their buying ia distinctly specu-
lative. and their presence IN the market
odds 10 it, speculative character by ex-
teuaivcly di%attihu'ing ~unrroductivn prop
erty among weak holders. The movement
Ia, in fact, a genuine lot hoom,
There IL every reason 10 believe that
speculative building is Icing carried to
eEcese in tho residence districts, The
plans filed last year in this city for apart
ments, fats. tenements, two-family houses
and ind vidral dwellings provided new
living quarters for not fewer than 500 900
people. The plans filed So far this year
raise that figure TO upward of 60o,0oO No
falling Of in building activity IL as yet
rent. although builders are beginning
to find it difficult. especially in Brooklyn,
TO Obtain loans for further operation.
The effects Of Oyerbuilding are not so
far reaching. however, as those which re-
suit from ovcrspeculation in vacant land.
Building seldom discounts the prospective
growth Of population by more than a few
years. Besides, II is automatically checked
by a hardening Of the loan market before
IL reaches disastrous proportions. Finally.
new house, can aways draw tenants from
older and less attractive ones by reducing
rents. In any event. both new and ole
houses can pay carrying charges. even II
INe no 1Hol TfHlLt lIt luN IuNtNtilcHl rV-
turns expected. On the other hand, a
lot boom like the ono now under way dis
counts not the immediate, but a distant
future. The great hulk OF the lots that
are at present being purchased for a rise
will not he available for improvement
until the effects Of the existing overbuild-
ing have passed away. Meanwhile, they
will have to he carried at a loss, and when
the next period Of building activity sets
In, many NJ them will no doubt still be out-
de the main area Of Improvement.
According to the opinion which prevails
among experienced brokers and OPERATORS
majority Of those who are now buying in
expensive lots will hardly be able to resell
within ten or a dozen years except at prices
lower than they are paying to-day. Ac-
cording to this opinion also, there will be
no profitable market for lots even at the end
of that period except in ~neighborhoods pro-
vided with city conveniences, such as
graded streets, sewers, water and gas.
A rush for inexpensive land by small
investors" usually completes the cycle of
booms that go to make up a period OF great
prosperity in real estate. We have already
had several years of speculation in improved
realty and in lots adapted for immediate
Improvement. The principal boom just
now is in the cheapest grades of land. in
lots hat must wait indefinitely for the
advent Of the builder. How long this last
boom is to continue is a question which
every broker and operator is just now dis
~cussing. but which none processes to be able
to answer The small investor" is known,
however, to be a persistent as well as an
indiscriminating buyer.