Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-01-01
REAL ESTATE
BY GEORGE Nj. FERRIS,


Washington Representative s. W Straus Co
Building conditions I'm this city ant
vicinity, as well as throughout the en-
tire country, are we'll stabilized as
the old year ends and the new yeal
comes upon the scene
Building permit records for the year
as officially reported to s. w. Straus
& Co. from the principal cities and
owns indicate a falling off of about {
Rent. On this basis the amount
money nut into buildings in 1926
IS, roughly speaking. $4,000 900 ,00C
as compared with $6,500,000, 900 dur
ing 1925.
Building permits do not cover fully
the construction of public works and
public utilities carried on outside city
limits. This has been a heavy year
with work Of this type so that good
and the amount of actual construc-
cy building permits has been made up
and the amounts of actual Construc-
ton for the period was probably equal
TO that of 1925 if not slightly in
excess.
Wages on Increase.
There was not much difference be.
tween 1925 and 1926 in the general
aspects of the building and construc-
ton situation. Wages in the build
The year. Building materials declined
from to per cent and general build
ing costs were from l to / u per cent
higher than during the previous year.
While the persistent rise in rents
due to the war shortage has been
checked in most localities and the rem
tai induces of the Department Of Labor
and the National Industrial Confer
ence Board show a slight. decline from
the abnormal peaks reached In 1924,
rentals generally are stable. They
are. in fact, being stabilized on new
/ and permanent postwar basis which
reflects not only our higher current
standard of living, but also the higher
level of commodity prices-the higher
level of all values and costs expressed
in terms of a dollar of lower pur-
chasing power.
Vacancies Are Healthy.
This adjustment of rents to a more
reasonable and more stable relation
to the prices of all other goods and
services has been taking place, as
lways, through changing conditions
Z supply and demand of buildings.
Is only natural that the working
1t Of this process has sometimes
been misunderstood. The first appear.
ice Of apartment vacancies, for in
nee, has been regarded as an indi-
On of overbuilding by many
les, who forget that a surplus of
residential as well as of business
facilities is normal, desirable and
necessary condition of healthy real
Estate market. In the lending &C.
Sivities OF s. w. Straus & Co. we al
ways assume normal percentage of
vacancy of at least 10 per cent. Only
in the case Of certain types OF facili-
ties in limited sections of certain cities
IS there any evidence of any abnormal
surplus existing at the present time.
and evensin such cases past experience
has shown that such conditions are
soon corrected.
The actual variations Of rents in the
future will depend primarily on local
supply and demand conditions and on
periodic business fluctuations. It
ehould be remembered also that the
blder semi-obsolete buildings will be
unable to meet the competition of new
structures on terms of equal rent, and
that in order to obtain or hold tenants
their owners will be compelled to re-
0uce rents. But, speaking generally,