Laurel outlook., 1948-02-04
Harris Discusses
Housing Problem

Continued from Page One)
there were 10 million. Most of the
latter are now out of service, want
homes and find there is a great
scarcity.
In the great demand of 20 years
ago the financing often consisted
of SO per cent loans, followed by
second and third loans, with rates
at 6, 8. and 10 per cent. EVERY
body got whipped" the speaker
said. Then came the time when
instead of f~ive-year loans the loans
were for 20 years, and then install
lment loans. Banks in Montana
were limited to 10 years.
In 1888 the people did not have
40 per cent to pay down. Came
then the Federal Housing admins
tration with a limit of 80 per cent
and federal guarantee of payment.
The set-up worked very well for
there was a raise in prices soon
afterward, actually offsetting much
of the dollar loan. .
The 10 million veterans came
home and found a deal of a per
cent with no down payment. The
Refinance corporation was set up
to buy loans from the lending
agencies, for the deal got sour be-
cause too many people were getting
too much money.
Because of the we'll known tough
living conditions occasioned by the
housing shortage and the resulting
budding in bedrooms, auto courts
and such cramped quarters, the price
of properties became no object. Po-
session was what counted. So, in
one instance cited, a $4,000 house
was bought for $4,000. When the
veteran was transferred he sold it
for $4,000, it changed hands again
for $4,000, and at last account it
had sold for S18,000-three times
it's worth. 1t was not a question
OF worth, it was the matter of get
ing some place in which to live.
Congress got busy and withdrew
the R. F. c., property handlers said
"We1l have to have something
down, 25 per cent in cash."
Surveys of the veterans, Harris
said, show they want fair wages,
fair prices, no unnecessary subsidies
and no inflated market. But de-
spite what they want, the fact re-
mains that a square foot of house
has moved from S. to S11.5O; wages
have in many instances doubled;
production per man,, because of
bottle-necks and other reasons, has
gone down, and a job that would
have taken three months now takes
II to IL months because of lack
of materials. The increase in Mon
tana has been from 10 to % per
cent. The pricing is beyond the
reach of the veteran. Vet loans
of SIS million have been made in
Montana.
What to do? The speaker said
builders and financiers have the job
of producing prices that veterans
can pay. Then he described the
reserve board in Washing
ton whose former head, since cut
down to vice chairman, said: "The
only way to stop it is. to stop IT,
meaning the upward spiral. 1t was
not long ago advocated that banks
be required to carry As per cent
reserves, which would stop loans.
But the opposition said: Conditions
are different in each community;
cts solve it according to individual
conditions" -.
The big banker on the board saio
he $4,000 banks of the country
would handle the situation better
han an edict from Washington, and
his is now being tried.
Under this method the questions
ire: as it a sound loan or IS 1t
an inflationary loan for speculation
properties, wheat, livestock, au-
,omobiles or real. estate? The idea
S to take are of necessary build
ng, but the satisfied vet who has
4 house to live in is asked to not
push up the market by maneuvering
'or another house and thus making
his buddy pay more.
The speaker concluded by SAYING
I'VE should put more in and axe
ess out, and give a days work 1or