New-York tribune., 1922-02-26
Many Cities
Need Second
MortgsageFunds
237 Places Report Money
Shortage to Secretary
Hoover: Few acant
Homes in the Country

Replies received to the question
uaycS sent out recently by Secretary
Hoover for the purposes of ascertain
ing the seriousness of the housing
situation and some Of the causes for it,
would indicate that the country is
greatly in need OF second mortgage
money. Replies were received from 249
real estate boards, representing 249
cities, AL but twelve of these boards S
or cities reported shortage of
mortgage money and discount rates
ranging from to 60 per cent. The
information also indicates that there
are few vacant houses to be had Mr.
Iloover's committee is now analyizing
ard arranging the information re-
ocivcd.
Henry r Brigham, of Boston, chair
man Of the housing committee of the
National Association of Real Estate
Boards, has made partial summary
Of the information in MIR. Hoover's
hands. He reports:
Replies were received from 249 real
estate boards. Two hundred and thirty
seven cities or boards reported short
age Of second mortgage money, al
though several qualified their answers
10y stating that the giving of second
mortgages is not 4 common custom
Some emphasized their answers by
saynG that there is absolutely no
second mortgage money available at
any price.
There was little unanimity about
discount rates. which were reported
as running all the way from per cent
20 60 per cent. 1t IS pleasant to note,
however that there were eighteen Civ
ing minimum rates below s per cent,
as against four giving over 30 per
cent a 4 maximum, with six giving 80
ner cent as a maximum. Six per cent
10 20 per cent rather clearly repre-
sented the most common range Of
rates. 10 per cent being the rate men
toned more than any other.
Purchase BASIS
In considering these figures it must
be remcm bered that there is also
wide range in the amount required for
initial payments, which naturally az
iccts the value of second mortgage Sc
curities, but, even so, the variety in
discount rates signifies now much local
conditions must affect mortgage money
rates. Furthermore, il seems to sug-
Gest at the present time wide variety
Of opinion as to the value OF second
mortgage securities, due, no doubt, to
the difference OF opinion as to whether
present real estate values are going to
lie maintained or to fall. Inc marked
tendency. however, seems to be conf
denee tnat they Will be maintained.
initial cash payments on purchases
of real estate arc shown to run from
4 per cent TO 80 per cent, with 20 per
cent to % per cent being the most
common percentages. Since more than
a quarter of the cities show preva-
lence of 10 per cent to Is per cent. it
would seem that the higher cash pay
ments are more matter of local Gus
Tom than necessity for safety in
properly and wisely managed develop
mcnt.
Few Vacancies Reported
"A majority Of the boards reported
20 vacant houses in their commun;-
ties, and comp paratively fee show any
apprcciab number os vacancies in
proportion TO their population As they
nearly all report some building in prog
re S. and as over on" hundred state The
number OF houses being constructed as
fifty or over, 1t IS clear that the demand
for moro houses is meeting with in
ereas'ng response. Eight cities report
ca 9uV or more houses iE process Of
construction.
"Noarly half Of the boards state
that hey have no Snecial time for leas-
ing. The others show the spring and
TALL months. or the spring or fall
months TO be the usual leasing periods
with April and May as the most pom
u1ar months IT might be well for
builders to consider this as an added
Ieasn II Tor trying to promote and to
IND means TO carry on more building
IN winter months. Yearly leases are
three communities. and in the ma
Jorlty OF cases the percentage Of
monthly tenancios is greater than of
annual leases.
In the grea' majority Of cities
frame houses are the most common.
only twenty eight cities reporting so
per cent or more Of their houses being
pfcN. Stuccp IS less common than
wood or brick. but in forty-onc cases
'nr pefcentage Of stucco houses was
gwen as 10 Per cent to % per cent.
with two reporting even higher per
cehtaecs. Hollow tile is not used at
ali IN twortN-nine cities. and as d rule
where used the least common form of
construction, although two cities re
ported 10 per cent Of their residences
g made OF hollow tile
Housing Laws in Effect Everywhere
ne proportionate value of lot to 4
house and lot appears in most cases to
nc about 10 TO % per cent, very few
reports giving 1t as under l5 per cent
or over - per cent. Twenty per cent
is the figure given moro than any other.
and doubtless represents the general
average or most usual percentage.
hese percentages are naturally affect
cd very much by the size and con-
ecStlon Of the respective communities.
Housing laws are twice as common
as zonlng ordinances, but The large ma
jority Of cities have neither. MANY
cities, however report that they have
one or both under considerations Here
again, however, the size and character
ot each city affects the necessity or
value and the consequent demand for
housing or coming ordinances. The
cities that have grown up without them
and are now struggling TO correct the
resulting evils ought TO be good les
sons for those who still think them of
little or no value"