Evening star., 1938-12-17
Home Builders Urqed
To Concentrate on
Lower-Cost Field
Demond for Buildings
Costing 81, 900 or
Less Cited

InOSe DullQlng homes Tor sale TO-
day are concentrating on houses
costing $1,000 or more and thus are
shooting wide of two thirds of their
potential market. the Federal Home
loan Bank Review said today in an
article urging stress on lower cost
housing.
The Review quoted Chairman
John H. Fahey of the Federal Home
Loan Bank Board as saying:
while I am aware that progress
has been made in better planning
1t cannot be claimed that we have
yet found the way to provide for
$4,000 and less the kind of home
the American family of moderate
means is entitled to have The
market for such homes is enormous
and the sooner we begin to meet
that demand the better it will be
for the business of the entire coun-
try"
In developing it's theme that pres
ent building is concentrated on
houses far beyond the means of
the average American, the Review
quoted a recent report of the Ma
tional Resources Committee on
Consumer Incomes in the United
States" which showed that 10 per
cent, or approximately two-thirds,
of American urban non-relief fam
lilies received annual incomes of
$4,000 or less.
! Partial Key to Problem.
These figures offer a partial key
to the housing problem the Review
concluded. 1T is generally calculated
by rule of thumb that a family is
justified in investing in home not
more than "a times its annual in
come.
! "On this basis one-half of these
lurban families could not purchase
houses costing more than $3.50.
= Only one family out of every three
could afford a house costing more
than $1,000.
The National Housing Committee,
= private research organization in
Ierested in the problems of low
cost housing, found that between
1880 and 1885. more than half of our
Residential building was concen-
ttrated in the construction of houses
costing SIS 900 and more.
I'VE were building mainly for one
Yamily out of three and we were ex-
Guiding two-thirds of our potential
consumers of houses from the mar
.ket."
The greatest market for homes,
sthe Review said, is among the
f.506, 5000 non-relief families in Amer
lean cities which receive the bulk
Eof their income from wages.
: Vast Untapped Market.
= ut is this wage earning group"
sthe Review said. which constitutes
"a vast untapped portion of the
housing market. These Wage-earn-
ing families have shown that. given
fhe opportunity to purchase homes
within their means, they are &C
tively interested in becoming home
owners.
The typical wage-earning FAM
ilys income ranges from 81 500 in a
metropolis to sl,150 in the smaller
cities. 1t is apparent that the mid
die families of these wage-earning
groups, no matter how strongly they
are inclined to own their homes,
cannot purchase houses that cost
more than $4,000 in the small and
middle sized cities, or more than
$3.50 in the metropolises.
Until consumer incomes are
raised, therefore, the only means of
tapping the market which does exist
for homes in this country today is
to produce a satisfactory house at
costs far lower than those prevail
ing at the present time.
TT is in an attempt to reach down
Unto this group of consumer units
and to supply adequate small homes
that the chairman of the Federal
Home Loan Bank Board urged the
cooperation of Federal agencies and
private institutions so that private
credit as we'll as the safeguards and
credit facilities offered by the Gov
eminent can be used to employ
more fully the vast resources of the
Nation as a whole