The New York herald. [volume] (New York, N.Y.) 1920-1924, 1920-10-10
BY Il. l.. BROWN,

lions and enacted laws proposing to re- |
heve the housing shortage in New York |
we are now where we started. with no
tangible solution in sight. Political ex-
pediency rather than constructive action |
on the part of our lawmakers seems TO
have been the dominant influence. In |
the main the advice and counsel Of |
trained minds were ignored. and SEEM
ingly primary and fundamental facts |
were either wilfully or ignorantly over
looked
For months committees of varied au-
thority have given time and thought to
the solution OF this problem. and recon-
mendations with and without merit have |
been freely discussed. In the meantime
the families of New York have been led |
to expect that the State and city govern |
ments. one or both, had the power, the |
intention and the ability not only inn |
mediately TO construct new housing re- |
gardless of the elements of time and |
money involved but to place them in |
the hands of the people at prices and |
on terms which precluded the basic cen !
giderations of present cost OF production.
Laws have been enacted which in Ell
feet, temporarily at least. place in the
hands of the courts the management and
control of privately owned property, sub
jecting the owners investment return 10
that amount which the tenant ard the
trial Judge. from their viewpoint, deem
sufficient The result of this action |
means, of course that for time teu- I
ants can retain and occupy their present !
apartments. over the helpless protest OF |
the owner. regardless OF his interest and |
his right to safeguard and protect In
vestments.
II these laws are sustained by the |
higher courts 1t is manifestly clear that |
fiat and apartment house construction |
will practically cease. for, notwithstand- |
ing the fact that new construction .s
now exempt from the operation OF thaae
laws, no assurance has or can be given |
that future Legislatures will not include |
all construction, new and old, under treir |
provisions, and land owners. builders and
lenders cannot in fairness be expelted
to place capital in business where even
d possibility exists that the value OF
their property can be disturbed. II not
destroyed. by the arbitrary action of
trial Judges, whose tenure o. Office
largely depends on the votes of those
whose personal interests are directly in
volved in their judicial decisions.
Deal Blow Mt Home Owning.
We cannot materially change human
nature and there is, as yet no indica-
ton that owners OF real or other prop
erty will expand or extend their hold
ings when, from theIs standpoint. a
threat of future confiscation, judicial or
otherwise, stands uncovered before
them.
One of the distressing results already
apparent, attributable 10 recent discus
sions and laws. is that thousands OF
families who intended and were amply
able to build or buy apartments and |
III. taly.
advantage OF their present rental au-
tocracy by continuing % occupy apart
ments which are desperately needed by
those who are unable 20 buy and are
forced permanently to occupy rented
quarters.
Forced by circumstances over which
they have no control, these victims OF
laws which punish rather than help
are denied better and more sanitary
habitasiob largely because the present
rent laws have been taken advantage of
by prospective buyers and purchases
have been postponed &c a more con-
venient season.
Home building and home owning on
the part OF the people of New York
have been seriously retarded by these
laws and so long as they remain In
force this condition will doubtless con-
tinue 20 exist.
Builders and owners cf vacant land,
no matter how willing or anxious to
build, are with few exceptions. stopped
on account OF inability TO secure mort
gage loans. In the past individuals and
estates. rather than savings banks. in
surance and loan companies, have fur
nished the bulk OF mortgage money for
home and apartment horse construction.
They have done this because. hereto
fore, real estate mortgages returned as
high interest yield as other safe securi-
ties and were preferred because Of their
stable value Under present conditions
however, they cannot compete with high
class, income tax exempt securities ana
FOR this reason alone new Individual
and estate Investments are not being
made IN real estate and building loans,
and those already in existence are being
called when matrred.
Our title ard loan companies, which
IN the pest. have financed the larger
part OF building opera lions. have prac-
ticaliv ceased TO function. due TO their
inability to sell real estate MORTGAGES.
and the savings, banks and insurance
companies with few exceptions, have
no free money 20 lend. The great In
vesting public. which is. after all. the
Anal absorbing power of real estate
loans has placed tfem for very good
reason on the biz elk list and there they
are likely TO remain until they are BY
law placed on parity with other sound
Investments.
Labor Costs 70 y. c. OF increase.
The supposedly high cost of building
material and labor has not been the de-
terrrining cause Of the present lack Of
building activity. Building costs are
high compared TO the pre-war period.
but until .he labor costs are materially
cut by drastic reduction in wages and
Increased efficiency practically no
change IN present prices can be hoped
for, notwithstanding newspaper accounts
of building material reductions Tho
labor cost. direct and indirect. in build
ing construction represents about rs per
cent of the total and with four years
OF actual shortage OF housing plus the
yearly normal requirements. which alone
are not nearly being supplied. one would
indeed be rash to predict any material
reduction in the selling or rental price
OF houses for the next five or ten years.
The sale values OF many things are
being reduced. and perhaps many more
will soon be included after all. however
these reductions are made possible only
BY rcason OF an over-sold market. With
housing. the situation is directly re-
vergcd The demand Ii ont Of proper
ton to the supply. and even with ACTIVE
-