New-York tribune., 1920-03-21
Realty Men
Drop Plan to
Build Homes
Continued from pas. on.

permanent cure could come from
building, and that any measure which
restricted investment, by making it un-
certain or Improbable, would stop
large scale building and thus prevent
real relief, even if it did reach the
worst forms of profiteering. The ex-
tortion, they charge, is being practiced
largely by men who have suddenly some
INTO the real estate business as specu-
lators and not by legitimate owners.
The restrictive bills, they declared
would accomplish little good. They
argued that they would be unconsti-
tutional and eventually would be
thrown out by the courts. But in the
intervening period of uncertainty they
said no one would dare invest. Other
provisions, such as that fixing rentals
at percentage Of investment, they
believed could be evaded by "wash
sales. of properties, putting upon
complainants 80 heavy a burden in at
tempts to attack the bona fdes of the
sales as to make the laws worthless.
AS real cure they urged the bill
giving tenants now holding without
rentals. 1hs, tksv ksvs1y sey.lets on '1ssnHi SsaIi
stabilize the situation, give at least
temporary security and stop the "wash
sales" and speculation by making it
impossible to realize the enormous
profits which have been common lately,
put they were unable to interest the
Legislators in this plan.
When it became evident that thew
could not change the legislators minds
on the subject several of them gave
warnings that they would keep entirely
clear of building and rental property
till conditions have changed. Since
real estate mortgages are now being
transferred to other forms of invest
ment at the rate of about 81 100000 900
a year, men familiar with the situation
beleve that this will result in a COM
plete paralysis of the realty mortgage
market and end all hope of large scale
building for some time to come. thus
continuing the present crisis indefi-
nitely.
Pre-War Rentals Called Too Low
The real estate men, moreover. do
not believe the apparently large per
centage increases in rent are so un-
gustlhable i as the legislators alleged.
City Investing Company and one of
the biggest operators in the city,
though handling no apartment prop
erty for leasing, was asked about this
yesterday.
Rentals from 1914 to 1917 were far
below real value in many cases" he
SAID, and there is nothing unfair to-
day in bringing them up to the normal
rate tor that time, plus the increased
cost OF upNeep and maintenance, which
is considerable. l know of one prop
erty, full block in the West Eiehties.
which in 1908, when it was finished
brought in a rental of $4,000 to ST.
600 year. By 1917 the income had
dropped to 5000. The owner was
entitled to bring it back to it's actual
value, which entailed SO per cent in
crease. He also was entitled to the
increased cost of upkeep, which would
amount to almost as much more-peo-
pie forget that all real estate owners
have to meet increased charges of
staggering proportions these days.
fact that if he is TO be able to get
the same purchasing value out of his
income that he had when he finished
his building. he must have two dollars
for every one he got then. If not, as
you know if you are trying to spread
a fixed income over the cost of living,
he is poorer off than before.
ut is the same way with Office prop
erty. In 1917 there were two or three
big new buildings which had SKINNED
the business section. Rentals were away
OeAOW value. NOW lncy are coming
back to normal and buildings which
have not paid for years are begin
ming to-"
One of the plans proposed at the
conference was by Justice Spiegelberg,
who urged that municipal court JUS
tices be allowed full discretion in re-
fuslng eviction papers, and stated
frankly that they would then prevent
dispossession while the case was be-
ing tried and delay trial as long as
they could. A measure he has drawn
provides that there shall be no dis
possession unless the tenant can find
fiat at the same rental that his land
lord is demanding, or less, and in the
same neighborhood. 1t fixes possible
rent increases at 20 per cent of the
former rental. Several of the legis-
lators present supported this plan.
Mr.. Bowling Charges Inequalities
Just see how that would work in
an apartment such as I have told you
about" Mr.. Bowling said when asked
about this bill. There the rentals,
all of them on leases, vary ACCORDING
to the time when the man moved in.
In 1917 he could get three or five
year lease at about S1,4OO. Another
N man last year would have had to pay
300 for the same kind of fat. Nov
If you stick to the 20 per cent plan.