Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 65, no. 1670: March 17, 1900

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March 17, icjoo. KECOlil) A^D GliDE. 449 ^ ESTABUSHED-^ttARPH2L«>lS68. Dn&TiD P Rf\LEsTATE.BuiLDlffc A,RCtflTECTUIlE.l;[aUSEl(OU.DEQai(WlMt ^ PRICE PER YEAR IN ADVANCE SIX DOLLARS. rublished every Saturday. TBLfiiFHONE, Cortlandt 1370, Communications should be addressed to C. W. SWEET, 14-16 Vesey Street. 7. T. LINDSEY, Business Manager. •Entered al ilic l'osl-0/fice al A'tiw York, ,V. 1'., as secoiid-clus» mallei:" Vol. LXV. MARCH 17, 1900. No. 1670. \ X 7 ITH two such events occurring as the signing of the W Currency Act cn this side and tlie tremendous over- subscripLion cf the British war loau on the other, it is surprising that the markets on hoth sides of the Atlautic do uot display more activity than they do. Scarcity of money is said to re¬ strain speculation and prevent indulgence in the only form of jubilation the security markets know w^hen they celebrate a vic¬ tory, namely, an advance in quotations. Without a deterrent of considerable force the important events mentioned would doubt¬ less have been recognized in the orthodox way. So strong is this rule that we cannot help thinking that the celebration is only deferred until the way is more cpen aud the generosity of the banks makes it more easy. As it is, a little activity and strengthening can be noted in the bond market; not very much, it is true, but enough to suggest the coming of something better, especially as it is most noticeable iu bonds outside of the gilt- edge list and in these of the speculaive class. There is money, much or little as it may be, seeking investment, and there is really nothing now to attract it but bonds of tbe lower grades and new additions to tbe ranks of dividend payers among stocks. Third Avenue is less of a wet blanket cn the market than it has been for some time. When the stock was lowest we pointed Dut that the selling had been overdone, and that opinion is more than confirmed by the advance in the face of the receiver's report, which is a most perplexing document to outsiders. Some familiar with the property have apparently the key to the riddle, and if they are willing to buy on a statement that reveals to the unin¬ itiated little else than confusion, the outsider is unwise who goes counter to their view. Official explanations of the new Currency Law wbich have appeared in all the daily papers serve to slioW its practicability and value; the dangers it removes, either of fears of a tampering with the legal standard of value or of an insufficiency cf currency to meet the enlarged demands of the commercial community. Jnow large these demands may be at a particular moment is illustrated by the recent distribution of many millions of dcllars by cne company, tbe Standard Oil, in dividends, the preparations fcr which, by the way, must have had something to do with the advance in the rates for money s^een recently. Though the market has failed to respond to much good news and is mainly professiona!, there is no reason to take a gloomy view of its near future, because it only needs a little more confidence iu the sufficiency of circulation, which the op¬ eration of the Currency Act ought to produce very soon, to create more activity with advancing quotations. THOSE who have followed the discussion of the question of tax reform in this State are under the impression that the necessity for that reform arose from the injustice of casting all public burdens upon real estate. This was claimed by friends of real estate and admitted when the Ford bill defining franchises as real esate and taxing them accordingly was passed last year. It was also admitted by the Governor in his message to the Leg¬ islature at its opening this year and by the framers of the Stran- ahan-AIlds bill, though the relief they proposed, so far as it re¬ ferred to the tax on mortgages, was considered by many as likelj to be of doubtful efficacy. If that bill failed adequately lo re¬ lieve the necessity that called it into existence, how much more so does the amended bil! introduced by Senator Stranahan last week with its exemptions to placate certain opposing elements, but those whose property it is absolutely necessary to reach for purpoBes of taxation, if real estate is to experience any substan¬ tial relief. Apart from that, a bill that discriminates in favor of people who can borrow money at low rates of interest^four per cent, and under—is certainly not much assista,nce to the strug¬ gling and needy who have to pay rates high in proportion to the urgency of their needs and the smalluess of their means. It is no woaider, then, that the introduction of the discriminating amendments have increased tbe opposition to the bill and tbe weakness displayed by its friends in departing from the principle originally laid down of reform of the tax system by a fair and equitable distribution of its burdeuB on ali classes of property and people, apparently has deprived tbe bill of what little chance of success it had in its original form , Looking to the Future. INFLUBNOES OF THE CURRENCY ACT AND THE FATE 0(F THE MORTGAGE TAX BILL. IN the Tt-eai EstaCe Salesroom this week the offerings at vol¬ untary, partition and executors' sales comprised thirty five improved parcels (dwellings, tenemients, fiats and a couple of mercantile premises) in Manhattan and seventy vacant lots in Bronx. Of the lots, half were sold; of the Improved pieces, Ofteeu. The foreclofiure schedule contained some thirty offerings, which, deducting the usual proportion of adjournments, were bought almost exclusively by plaintiffs. The brokerage reports disclose a similar condition of Inertness in the private-sale branch of tbe real estate market. Apparently the only probable means of reinvigoration in sight, so far as the immediate future of the market is concerned, are the new currency act and a prompt settlement of the mortgage- tax agitation. Some brokers think that the currency act, in the course of the year, will cheapen money to such an extent as to induce real estate speculation acd investment on a large scale. However, competent financial opinion is divided as to the influ¬ ence which the act will exercise upon the circulating medium— whether the vclume ot currency will be notably or only mod¬ erately increased. Precise observations as to the act's effect on real estate are, therefore, impossible. Nevertheless, there will undoubtedly be an appreciable tendency toward chaper money. A feature of the act is that, by facilitating in every section of the country ample bank-note issues in response to local temporary demands for currency, the traditional move¬ ment of capital at certain seasons, particularly the crop- marketing mcnths, from New York to the interior will Ije checked. The New York banks, in the absence of the tradi¬ tional drain, may find themselves in a position to offer money at low terms in the late summer and early autumn, with the result of infusing some animation into that customarily stupid period. One thing may be taken for granted, namely, that any con- siderablo augmentation of the currency wiil result in a fall in the general interest rate on money. With speculative building checked, with rents stationary or, as is the case in some forms cf realty, rising, a fall in the interest rate would mean immedi¬ ately a corresponding increase in the net income from improved real estate, some part of which would ultimately be capitalized in the fee value. A substantial increase in the currency would, further, prolong the existing period of industrial prosperity, and thus, by augmenting the production of wealth, augment the com¬ munity's ability to buy homes and acquire real estate. The Stranahan bill does not appear to gain friends as time goes on. It was denounced Thursday night by a meeting at the AstOT House of representatives of fifty-seven building and loan associations in the State. The United Real Estate Associations cf New York, through their president, Henry Markus, are issu¬ ing a circular in which the defects of tbe bill are clearly summa¬ rized. T'he introductory remarks ol the circular read: "Tbe United Real Estate Associations of New York, having 3,200 mem¬ bers, of whom few are wealthy and many own mortgaged prop¬ erty, have unanimously adopted resolutions comdemning the Mortgage Tax bill. The Real Estate Board of Brokers and the West End Associations, composed of real estate'owners, have taken like action. We protest against the burden of supporting the State being placed upon the owners of mortgaged real estate. The amendments to the bill make it more unjust than before. Wie approve of the Elsberg bill, because it will promote economy, fix the responsibility for extravagance, abolish equalization, ap¬ portion the State tax fairly and permit the exemption of mort¬ gages." I HOW many kinds of a scapegoat is the owner of real prop¬ erly to be? Just now the District Attorney threatens to hold htm responsible for the neglect (?) of the police in permit¬ ting gambling and other illegal occupations to be carried on in this city. That is to say, the person who pays the policeman is to do his work also. Any property owner who violates the law which forbids him to let his premises for certain purposes de¬ serves to be punished and is punished from time to time, but what the District Attorney threatens is to hold the owner of the premises responsible for wrongdoing therein, whether he Is cogni-