Evening star., 1939-05-13
1888 F. H. A. Activity
90 Per Cent Over
Preceding Year
New Building Sufficient
To House Increase
In Population

For the first time in nearly a
decade, the volume of residential
building in 1898 was more than suf-
f1cient to house years increase in
population and to replace houses
destroyed or torn down, according
to the annual report of the Federal
Housing Administration for the year
ended December 81, just submitted
to Congress by Administrator Stew
art Mcdonald.
The year was the most active in
F.. H. AS history, Mr. Mcdonald
said in letter transmitting the re-
port. and gross business transacted
hv the Administration exceeded
S1.250000.000, an increase of ap-
proximately 80 per cent over 1887.
Total business included $l.Ol0,O0O,-
600 in small-home mortgage insur-
ance applications. commitments to
insure $74000000 of mortgages on
large scale housing projects and
proper improvement loans
amounting to $l73,000.0G0 insured.
Building Aided Revival.
The sharp rise in these credit
insurance activities was largely in
strumental in the vigorous revival
in the residential construction in
dustry which was one of the ear
liest and strongest forces acting for
recovery in business and employ
ment from the recession in late
1897 and early 1888" Mr.. Mcdonald
said. Total residential construc-
ton was estimated at more than
346,OO0 units for the year, with
Single-family structures accounting
for $4,000 of the years volume.
Commenting on the fact that the
administration had insured a grand
total of $4,000 small-home mort
cages amounting to 1900 900 900
through December 81, 1898, Mr.. Nc
Donald expressed the opinion that
the mutual mortgage insurance sys-
tenn has 'established a new epoch
In home financing in this country
Jong-term fully -amortized mort
cages for a high percentage of the
value of the property have been
made a suitable form of investment
for the principal types of financing
institutions that serve as custodians
OF long-term savings funds" he said.
TN turn this makes such credit
available to small borrowers
throughout the country at the lowest
rate of interest ever generally avail
able"
Mortgage Market More Stable.
Because of the large increase in
the number of new homes financed
with insured mortgages. the Federal
Housing Administrators property
standards, minimum construction
requirements and neighborhood
planning standards, have exercised
q growing influence on the stability
Of the home mortgage market.
inexperienced home buyers have
come to realize that the F.. H. A.
provides, for the first time in our
history. an agency which can give
an unbiased opinion on the quality
OF the home securing the mortgage.
the ability Of the borrower to meet
mortgage payments and other mat
ters of great importance to the home
buyer.
Financially, the mutual mortgage
insurance system has reached point
where current receipts, chiefly from
appraisal fees and mortgage insur-
ance premiums, are well in excess
OF operating expenses. Mr.. McDonald
said. In spite of the additional
duties imposed on the administration
by the 1898 amendments to the Ma
tionsl Housing Act and the conse-
quent increase in insurance activi-
ties, operating and administrative
expenses of the administration were
less than s1l l,400OOO in 1898.