The Washington herald., 1908-03-22

In the rapid growth and development
of Washington there are many oppor-
tunities Tor the purchase of real estate,
with the distinct purpose of reselling at
an advance upon the price paid. Strange
ly this perfectly legitimate form Of trans
action is spoken of By many unthinking
persons as speculation" with the i'm
piled inference that It is at the same
time questionable.
While buying a piece of property with
a view 20 its sale again in a short time
at better figure" buying for q rise
as the expression is, can hardly be called
investment II Is still making money in
about as straight manner as it is pos
sible 10 do so. The man who questions
ii must be ignorant or cynical Buying
property in this way. Of which there is
much done in Washington, should not.
even in a mans thought, be confused
with the opprobrious idea OF gambling IN
real estate. There is all the difference
between the two that exists between
legitimate banking and transactions in a
bucket shop
Requires Much FOreAight.
Buying property for rise. to be sue
cessful, requires much more than the
happy coincidence Of a rising market.
The process involves keen foresight as
10 the probable growth OF a given local
ity where the property is situated The
question 10 be decided is, will the sur
rounding real estate develop and carry
up TO higher figures the piece TO be pur-
chased? Are building operations pro-
crossing toward the plot in question? Is
it likely that a buyer can be found who
will want the holding a few months or
years hence for a price that viii repre-
sent a good profit?
To answer these and other questions
regarding a prospective purchase requires
accurate knowledge of values. of the
movement of business and population.
the relation OF transportation facilities
10 the region where the property lies,
and to other conditions which always
enter into the value Of real estate.
Again, If the property bought is already
improved. in the business section or
among the older residences OF the city.
does it offer good advantages for rental?
With a reasonable outlay for repairs or
remodeling of the building will it pay a
higher rentai2 Is it so situated as 10
invite a higher grade tenant? These are
questions which enter into the intelligent
purchase of such property as described.
II is a wise man who can invest under
such circumstances with a certainty of
profit and If his foresight or willingness
10 make improvements results in large
profit. the logic is inevitable that he de-
serves all he can realize on the trans
action.
Speculation Not Now Common.
There was a time in Washington when
there was much more speculation in real
estate than now II was the boom times
Of fifteen or more years ago, when the
option was the chief means of opera
tion, and when sharpers sometimes
realized profits on the buying OF a piece
Of property one day, to sell it next week
at an advance. SO far as the speculator
was concerned a few hundred dollars
margin on the option was sufficient to
realize a snug sum in the final deal.
Another scheme of this kind, sometimes
worked in Washington. is for a crafty
speculator to find piece Of property un-
der litigation in the settlement Of an
estate. The speculator finds a purchaser
who will give a specified price for the
property He then works out a sale Of
the holding from the heirs of the prop
erty at several thousand dollars less than
this price. The legal questions are set
tied. the property conveyed, usually to a
third party. and then resold to the pur-
chaser, at difference six or seven times
larger than a legitimate commission.
Both these forms of speculation in
Washington were chiefly rooted out in the
dull times following the year 1898.
Speculation In Acreage Land.
In the suburban section a form OF specu-
lation has been rife which may be ques-
tionable according to the methods pur-
sued. This is to buy up acreage land.
subdivide il into lots. make some improve
ments. and resell in lots at an enormous
advance upon the price paid. When the
development OF subdivision is carried on
with view 10 permanent settlement,
when money is laid out in streets, sew
erage. and physical development. which
adds value TO the land by making IT de-
sirable as a place of residence. then the
transaction is meritorious in every re-
sPect. even though the operating company
does make large profits. But when the
exploitation of a suburban tract proceeds
only on hot air. 20 use an expressive
phrase Of the street. ana when there is
no effort beyond inducing the sale Of lots
TO persons who may be cajoled into buy
ing practically under false representa-
tions. this form of speculation is repre-
hensible and harmful 10 the best interests
of the city.
Promising Field for Investment.
These forms of land buying and the
methods pursued by the agents are emu
merated to give greater force to the truth
that Washington is to-day one of the
most promising fields for legitimate in
vestment in real estate in the United
States. In the first place. land values are
not high I'm Washington. as compared
with cities OF the same size and inlpor-
tance. No ground in Washington has
ever been sold as high as 800 a square
foot. even in the best of the business
district The highest figure paid in recent
years was S76 foot. Residence property.
even that upon which the mansions OF the
city stand. does not have 70 be covered
with SO bills for its purchase.
The second item 10 be considered is
that land values fer many years in good