New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1920-08-29
Lack of Mortgage Money
Deferred to Construction
Building Will Follow if Loans for Erection of
Homes Are Exempt From Income Taxation
BY William D. Fitzpatrick

"Why don't the builders build,
mother?" is the wall of an army of ex-
pectant brides, in the chorus of which
all the relatives and friends of the
bridcs-to-be join most Justify.
1t isn't pleasant to say so, but, bon
little building for long time to come
unless the unexpected happens, and
such happening of the unexpected is so
remote as to be negligible. There are
many reasons why builders do not
build and will not build.
Passing by the never ceasing govern
riental hammering of real estate for
the last decade, which resulted in
cessation of building through lack of
situation of to-day, the construction of
multi-family houses in which most
New Workers live is all but an eco
nomic impossibility. The all but un-
surmountable obstacles to such greatly
needed housing are:
Lack of mortgage money, which has
teen in the past the most important
factor in the production of houses
Due to income taxation, this mortgage
money is galloping out of real estate
at the tremendous rate of $2o0,oO0
day. With the sinews of war dlsap-
nearing like snow before an April sun
il is idle and futile to expect building
to be resumed This condition may be
rcmedied by the Legislature at its spe-
cial session next month if the Leglsla-
ture has seen a new hight.
The rent laws have had exactly the
vicious effect predicted at the time of
their passage, viz: the encouragement
Of housing production.
Unionism Causes Of Delay
"Unionism," as to-day practiced IN
the building trades, is prime deter
rent to building. Under production,
enforced by union rules, infraction OF
which is punished by fines or expulsion
and consequent loss of livelihood,
isn't exactly keen sort of attraction
for builders. The mechanics them
selves are not responsible for this state
of affairs and resent the condition
which causes them TO be essentially
dishonest, but they are absolutely help
less to prevent such dishonesty, due
to the union methods employed, where
by a handful of slackers, incompetents
and shiftless henchmen of leaders can
and do make vicious rules and regula-
tons, vote causeless, CONSCIOUSNESS
strikes and raise Sam Hill" in general.
Fifty of these henchmen can and do
vote ] 500 men on strike against the
wishes and desires Of l ,450 workers.
The remedy for these conditions is
SO simple as to be ludcrous, IN view
of the existing union industrial slav-
cry. The remedy is only what the real
workers seek: viz, a secret ballot con-
Quoted under city or state auspices.
When this comes to pass and the real
workers, not the lilies of the field, are
in control of their unions, we can then
kiss needless strikes and other vicious
forms of unionism a fond farewell.
The cost of building material and
l. l.. 1-l~ Lak tA
building of apartments is not an eco
monte proposition. This is best ex
pressed in figures. A typical example
is the popular 50-foot walkup apartment
house which cost formerly about
$4,000 to produce. To-day's cost of the
same building is $4,000. The present
selling price of the existing 50foot
house, say, on Washington Heights, is
from $4,000 to SIS, 900. including land
The same house erected today, includ-
ing land would have to bring $4,000
10 $4,000 n double the price of the
existing building. 1t is as obvious as
q war on Roman nose that produc-
tion N or such abnormal conditions is
impossible
High Construction Cost
Again Ike rent necessitated by pres
ent day costs would not only be ex
ceaiveiy nigh by reason Of such costs,
but would also have to be heavily added
to TO provide against the decrease in
the future cost of building. For ex-
ample, if five years from now the cost
of building has decreased so that the
cost of the hfty-foot house would still
be 80 per cent higher than the 1914
cost of $40 900, the owner of building
would have to get $4,000 excess rent
during that period, or $4,000 year
in excess of rent already so high
that it would be beyond the reach of
the average New Yorker. In short, the
ffty-foot fiat (now rented at "profiteer-
ing" rents of $4,000 a year, would
have to produce $50, 1000 or more.
The one silver lining in the dark
housing cloud is project now being
hammered into shape for the produc-
ton of $4,000 apartments to be rented