Evening star., 1937-12-03
WALLACE |NDORSES
HOUSING MEASURE
Sees Aid to Farmers by
Increasing Purchasing
Power of Products.
By I. A. O'LEARY,


The administrations new housing
bill won the Endorsement today Of Sec
retary Of Agriculture Wallsce and Paul
e. Stark of Madison Wis, president
OF the National Association Of Real
Estate Boards. as Senate hearings on
the proposal continued.
The measure is designed to check
the recession in business by encourag-
ing private home building operations
through more liberal rules for the
Federal Housing Administration.
Secretary Wallace testified the bill
would help farmers by increasing the
purchasing power for agricultural
products in industrial areas. He sug-
gested, however the need for legisla-
ton, either as an amendment to this
bill or otherwise. to correct some of
the great disparity between city and
rural housing"
Calling housing conditions "appall-
ing" in some places, Mr.. Wallace de-
clared:
If you compare housing of some
areas with rural areas of Europe you
are forced to blush for America"
Committee Members Concur.
Members of the Banking and Cur
rency Committee concurred in his sug-
gestion that various Government
agencies confer to find out whether
farmers could utilize the pending bill
to improve rural housing conditions.
1t was pointed out that one diff
Guilty in applying this bill to agricul-
tural areas is that many farmers al
ready have their property mortgaged
and that such mortgages are based on
the farm as a whole crop-raising land
as we'll as buildings.
Mr.. Stark said his national real
estate group is in favor of the bill
because We believe 1t will stimulate
the industry and lower COSTS 1t will
reduce costs, he explained, by bringing
in large-scale operators. Lower build
ing costs, he said, are necessary in
view of the fact rental class small
builders, putting up few houses an
nually, have little bargaining power
in buying;
Previously, Secretary Wallace had
declared, IF housing program gets
gong it will carry up income OF
probably three-fourths of agriculture
But 1t is essential that housing costs,
as interpreted in rents, should not
take more than some customary per-
centage of income. Farmers are in
terested in that because If too high
percentage of the workers income
goes for rent there is less left over
for food.
Stark Gives Views,
While he favors the bill as it stands.
Mr.. Stark told the committee that &C
tiv1ty must be stimulated in the field
OF housing lower income groups, the
people who can afford to pay between
$40 and $50 a month. If those groups
can be provided for, a large-scale
building program would result. MIR
stark declared, but he expressed the
view that this purpose could be &C
complished more easily If the period
OF amortization could be extended
from 20 to 80 years and with an in
terest rate of AZ per cent. The bill
is intended to encourage financing OF
homes with the capital furnished by
private institutions, and F. H. A. In
sur1ng the loans on individual houses
up to 30 per cent In its present form
1t contemplates an interest rate to the
investor of per cent.
Senator Bulkley, Democrat, of Ohio
said the problem before the committee
is to determine how low the interest
rate can be fixed to provide houses
within the means of this large group
In the lower income bracket and still
attract private capital into the hous-
ing field.
Favors Federal Subsidy.
Pointing out that the Government
in the past has tried to get industry
going by direct building programs.
such as P. w. A., he added it would
be better now to subsidize home con-
struction by lower interest rate than
to go on trying to stimulate industry
by building with Government funds.
Asked by members what progress is
being made in the direction of pre-
fabricated houses, Mr.. Stark said this
development is "in the off1ng, but lacks
one thing-multiple production" The
pending bill, he said, by encouraging
1arge-scale operation, would help to
bring about multiple production, which
Is necessary to reduce costs.
He also told the committee that real
estate developers are turning away
from the idea of merely selling indi-
Vldual vacant lots in new subdivisions
and adopting the plan of Offering buy
ers the completed home, so that they
will know what their fixed charges will
be when they buy.