Alma record. (Alma, Mich.) 1878-1928, 1922-12-14
MUCH BUILDING
IN YEAR 1928
BABSON SAYS THAT MUCH CON
STRUCTION WILL BE DONE
DURING THE YEAR.

has spert itself. Roger w. Babson
evidently doesn't think it has. In
commenting 10 day on the building
outlook he called attention to several
bullish factors.
"New building" says Mr.. Babson,
sis the outstanding feature of our
business recovery. IL is what started
us on the road TO better business.
Never before in the history of the
country have so many new houses
been built as in the first ten months
of 1922. For every house that was
built in 1921, two have been built this
year. Last year in twenty-seven
northeastern states of the country
we spent $6SS,OO0,O00 for homes; this
year we have already spent 81 ,099,-
100000, and wher the gong rings on
December 81, the total will very like
ly show 100 more than in 1921.
"This building revival is not con-
fined to houses either. House build
ing has beer the most spectacular
but we have also built many more
offices, factories schools, hospitals,
roads, bridges, reservoirs, memorials,
in fact, all kinds of construction
Whereas our normal building total
is about S3,0O0,000, 700, the end Of
this year, we shall have built to the
extent of $5,OO0,OO0,O00
When asked if he did not think
that we have already over-done this
building boom, MIR. Babson replied:
Il do not think so yet. | look for
continued building activity, both in
residential and business building for
the greater part Of 1923. Beyond
that time, expect decline. A sur
vey just made by the National AS
socistion Of Real Estate Boards
shows that, out of total Of 1S4
cities scattered over the country, 12l
cities still report housing shortage.
OF the remaining G3 cities, 53 report
no shortage and only 10 a moderate
shortage. This study corroborates my
opinion that there is still much resi-
Dental building to be done, altho the
peak may have been passed"
What about rents" Mr.. Babson
was asked.
High rents have probably passed
their peak. The long swing will be
downward. Here again it is a ques-
ton of supply and demand. The
coming decline in rents will not be
abrupt, at least, rot until this build
ing boom has supplied more of the
shortage. Rental advances for the
present are slightly more numerous
than declines, hut in the majority of
cities there is TO movement either up
or down. Gradually, of course, the
trend will turn downward as the de-
mand is more fully supplied. In
dustrial and business rents show sur
prising stiffness due 10 business re-
covery, but these do not indicate any
lorg continued advance.
81 am particularly optimistic with
regard to suburban building devel-
opment The boom in city building
will probably not last more than
year, but suburban building is diff
ferent. Auto traffic is so congested
in the big cities that shoppers had
rather trade in suburban stores than
drive into the heart Of our great
cit;e5. City dwellers are looking for
homes in the country. | cannot en-
phasize too strongly the Importance
of this tendency toward suburban ex-
pansion."
The Statistian was asked what
effect building material prices and
labor would be likely to have on the
building outlook.
That's where the danger lies" he
replied. "Unless prices of building
materials are kept down at least
near present levels, the people will
stop building, just as they did in 1920.
In fact, ! DO not think we will see
quite so much building next year I'M
less there is some reduction in costs
During the next few months mater
ial prices should show some seasonal
weakness. But as sure as the mater
ial dealers start IN to boost prices
next summer, they will choke off
their business. The same warning
applies to labor. Wages are already
S high as they can be and still allow
much building. Both labor and ma
terial men should realize that it is
better for them to nave steady build
ing at moderate profits than it is to
have a short squirt of building at
high profits, followed by long
period of idleness.
However, what interests me as
much as anything is the necessity of
eliminating the waste in time, labor,
and materials in the building bust
neGs. | firmly believe that a saving
of l5h to 25et in the cost of building
could be made by cutting out this
waste. The country is literally
throwing away 81 ,0OO,OO0,OOO annual
ly which might be saved for the in
dustry ard help to reduce the cost
of construction. Over a half billion
dollars loss occurs from lack of en-
ployment in the dull seasons, strik-
crs, poor labor management, etc.
am glad TO see that wide awake men
in the contracting business are ex-