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Real estate record and builders' guide: v. 75, no. 1933: April 1, 1905

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RECORD AND GUIDE 679 Etofoin) TO f^L EISTWE. BulLDIf/c l^ROtrrECTURE .HoosEiloii. DEQfflifTloH, Busi(/ess Alto Themes Of GeiIer^I IKter^si. PRICE PER YEAR IN ADVANCE SIX DOLLARS Vablished eVerg Saturday Communications aUouk C. W. SWEET, 14.16 Ve e addressed to y Street, New YorK Teiophone. Cortlandt 3157 ••Entered ai (he Pout Office at Neio York. N. Y.. as secojid-ctass niatter." Copyrighl by the Real Estate Record and Builders' Guide Company. No. .I'i33- Vol, LXXV, APRIL 1, 1005. THB real estate ti'ansactions of the -week indicate a wide¬ spread, very well-balanced activity. The somewhat ex¬ travagant speculation in vacant lota- has moderated; and in the sales- which are now taking place, builders more frequently figure. These speculative movements appear at times to get beyond control; but it is extraordinary how quickly they sub¬ side, when prices verge on the danger line. The fact that the dealers are professionals makes them cautions; and then the money-lending institutions-soon discourage excessive advances in prices. There is room for a good deal more building than has yet been announced in the newer sections; and further specula¬ tion will wait wpon such announcements. In the meantime buy¬ ing is active in every part of Manhattan—on lower Fifth av, on upper Fifth av and on the side streets. Expensive residence property is in better demand than for some time past; and many high-class apartment houses will be constructed. The year is evidently going to be a very good one for the West Side, as well as for the newer sections. There is still some hesitancy in announcing plans for big improvements; but there is every evidence that these announcements will come with a rush at a little later date. It looks very much as if builders, who need any considerable tonnage of structural steel, will have to engage it soon, or else be obliged to put up with delayed de¬ liveries and higher prices—as in 1902. A MORE vigorous opposition has been developing during the ■'*■ past week to the bill taxing future mortgages; but'it looks as if this opposition bad appeared too late. The measure has been made a part of the official policy of the Republican party, and the caucus has been used to whip protestants into line. The Governor is determined that the new indirect sources of taxation shall be sufficient to meet the deficit; and at this late date it would be difRcult, if not impossible, to devise more acceptable substitutes. Consequently the proposed mortgage and stock transfer taxes will be imposed, unless the opposition can be made too forbbiding—which is unlikely. It is unnecessary to repeat at this juncture the reasons, which make a mortgage tax both unjust in principle, and inexpedient as a tax upon the improvement of real estate. In case the proposed tax is de¬ feated, it will not be because of such arguments; it will be be¬ cause the Republican leaders are convinced that their tax policy is doing their party more harm tban good. Neither sbould it be difficult to draw up a convincing brief along these lines. Hitherto the indirect taxes have affected chiefly certain special interests and classes, such as the liquor-dealers, the corpora¬ tions, or beneficiaries under a will- But almost everybody who builds a house in the state of New York, particularly if he is a compapatively poor man and must borrow money, will feel the burden of the mortgage tax; and the effect of this imposi¬ tion will be to disgruntle them with the party, which is re¬ sponsible for it. The Republican leaders should look sharp and tread cautiously. They are reaching a point In the de¬ velopment of their policy of taxation which compels them to offend more people than they gratify; and inasmuch as the existing deficit is merely the fore-runner of a continuing future scarcity, they should consider carefully whether they will not in the end provoke an amount of popular disgust, which will make the state Democratic for many years. THIS is a traders' stock market at present, fluctuating chiefly for professional reasons. When prices go down a few points, it merely means that stock bought at lower prices can¬ not be sold without depressing values, and when prices run up it means chiefly that stock sold at higher prices cannot be bought without advancing them. During the past week it has been a drawn battle. Business is so good and prospects are so favorable that the bears can only expect to make a few points, while security prices are so high that they can hardly go highef until some new stimulant is provided. The stimulant may come from a number of sources. There may bo some ad¬ ditional railroad consolidations, or crop prospects may be un¬ usually favorable, or certain railroads may feel strong enough to divide more money among their stockholders. But we may feel sure that in one way or another the stimulant will be pro¬ vided, for prices will not be allowed to rest where they are. There is plenty of stock accumulated at the low prices of last year, still remaining to be sold, and the hoMers of this stock will make a market for it- Probably, however, they will not be able to make such a market until a month or two later. Real Estate in 1905. The Record of the First Quarter. "\T 7" have frequently referred to the unprecedented number of * * real estate transactions, which are being consummated at the present time; but now that the first three months of the year are over, it Is worth while to pause for a moment and see what the activity really amounts to, and how it compares to that of previous years. The total number of conveyances re¬ corded during these months, omitting only the last three days, is 5,011 in Manhattan and 3,418 in the Bronx. The figures for the corresponding period of 1904 were 4,156 in Manhattan and 1,324 in the Bronx. This is an increase of 25 per cent in Man¬ hattan and about 150 per cent in the Bronx. Taking New York county as a whole the percentage of increase is about 60 per cent, so that not only are the totals absolutely unprecendented, but the ratio of expansion is larger than has ever been wit¬ nessed before in any one year. The mortgage records tell the same story. Thus the total number of mortgages on Manhat¬ tan property recorded has been 4,738 in 1905, against 3,640 in 1904, while the Bronx mortgages increased from S19 in 1904 tt> 2,590 in 1905, the proportion of increase in this instance amount¬ ing to about 75 per cent in New York County. The amount of ' money carried by these mortgages shows even a larger increase. So far in 1905, over $131,000,000 has been loaned on real estate in New York County against only about $66,000,000 for the corre- fiponding period of 1904, $88,000,000 for the corresponding period of 1903, and ?89,000,000 for the corresponding period of 1902. The increase amounts to 100 per cent over 1904, and to about 60 per cent over 1903, which was in this respect a more normal year than was 1904, It will be seen consequently how phenom¬ enally large the volume of real estate transactions has become. An analysis of the percentage at which this money has been loaned on Manhattan property indicates with great accuracy the character of the business, which has caused this enormous increase. In spite of the fact that it was difficult to borrow money on real estate during the first three months of 1904, the greater part of the increase has not occurred in mortgages bear¬ ing comparatively low rates of interest. Roughly speaking, there has been loaned at 4 and 4^^ per cent, about $13,000,000 more during the first three months of 1905 than there were dur¬ ing the first three months of 1904. The amount of money bor¬ rowed at 5 per cent is only a few million dollars larger than it was during the previous year. On the other hand, the mort¬ gages carrying 6 per cent interest are far greater in number and in amount involved than ever before. About $50,000,000 has been loaned at this high rate of interest against less than $18,000,000 during the first three months of 1904. and against only about $15,000,000 for the first quarter of 1903. Thus it is obvious that the increased business has consisted principally of speculative transactions. Money loaned at 6 per cent is loaned, either for building purposes, or to carry through other more or less risky operations; and the enormous sum. which has been placed at this figure indicates that the bulk of the increased business has been the work of operators, who were speculating in real estate and could pay high for the accommodation they required. The filings of the Building Department tell the same story. The new Manhattan buildings projected during the first three months of tbe year call approximately for the expenditure of $24,000,000, a total which is donble that of the corresponding period of 1904, and larger by several millions than the analogous figures both for 1903 and 1902. But this increase has taken place exclusively in one class of buildings. The plans for new busi¬ ness buildings call for about the same sum in all four years—a sum, varying between $4,000,000 and $5,000,000. The plans for new private dwellings call for a slightly larger expenditure in