The sun., 1907-09-29
The REAL ESTATE MARKET
SAVINGS BANKS HAVE no FUNDS
TO INVEST IN MORTGAG

Their DepOsitOrs Have for Some Months
Drawn Out More Money Than They
Have Put ln-High Interest Rates and
Overbuilding Check Demand for Realty.
There are two very good reasons Why
hardly any business 10 being done just now
in the real etate market In the first place
il il almost impossible to borrow money.
In the second place there are too many
new buildings on the market. Other
reasons might be mentioned TO account for
the fact that the volume OF dealing 10 no
larger to-day. when operators and in
vestors have returned TO town. than IL was
during the midsummer period; but scarcity
OF capital and overbulding are the most
important and the most widely operative
causes.
II ia not far from literally true to say that
moneyed corporations are not now lending
on real estate. Last week. for instance.
only ~ 800, 900 was invested in mortgages
on Manhattan realty. as against go, ,os2. 900
in the same week year ago. Ordinarily the
bulk Of the money put into mortgages Ii
furnished by banks. trust companies and
insurance companies. Such corporations
supplied 81 per cent. Of the sum loaned
during the week ended September 81.
1909. They provided snly % per cent.
OF the sum invested last week.
1t 10 q long time sinoe the trust and in
surance companies ceased to offer money
on mortgages in any considerable amount,
and since last May the savings banks also
have had little capital to invest. II IL said
on good authority that since then. and
especially since July. savings bank de-
positors in this borough have drawn out
more money than they have deposited.
Consequently the savings banks have. like
the trust and insurance. companies, vir-
tualty retired from the mortgage loan
market. Generally speaking. they have
not even been in q position to profit by the
current low prices OF bonds.
II Ia to be noted that the heavy with
drawals Of savings by depositors have not
been occasioned by loss OF employment,
but chiefly by Investments In Wall street
securities and in suburban real estate
However. the effort has been to close for the
time being an important source OF mort
gage loan money.
When builders are Obliged to pay 10
per cent. or more In interest and COM
missions" for ono year building loan.
and when investors are required to pay
or per cent on q conservative -perma-
nent" mortgage, real estate must show
better returns than most Of II does at pres-
ent to induce any degree OF activity in
The current renting season has disclosed
the fact that there is great over supply
Of four, Ave and ak room fats. The build
ers Of this town have for several years
been putting upthe common type OF housing.
apparently without any regard to where
tenants are to come from. The super
abundance Of medium sized fats is in turn
affecting the renting OF two family houses.
II is not surprising, therefore. that tie
investment demand for the ordinary run
Of fats and OF two family houses 10 not
what IL was last fall.
Meanwhile there is an undersupply Of
fats Of seven or more rooms. rents having
been quite generally advanced this summer
in such fats. especially in fats Of eight to
ten rooms. No doubt medium sized fats
will continue to be built for some time
on fairly large scale. owing to the number
OF vacant lots still in the hands Of operators.
but the tendency 10 evidently toward the
of large nats and Of other
vneia1aooo a housing, fron tho Oouamou