LAND AND MORTGAGES.

Auckland Star, Volume LV, Issue 162, 10 July 1924, Page 4

LAND AND MORTGAGES.

The references to mortgages made by the Leader of the Labour party in his . speech on the Address-in-Reply have at least the virtue of drawing attention to j the relation between mortgages and values. Mr. Holland said that registered mortgages in New Zealand totalled £258,000,000, or "half the total capital value of all the land," which meant that quite three-fourths of the capital values were mortgaged. This mortgage total is for the end of the last financial year. The latest land valuation total, available—a year older—is £553,000,000, so that the mortgage total is not quite half of the valuation. It is, however, sufficiently large to be remarkable. More information on this connection between mortgages and values woulft be instructive. What is the percentage qf properties that bear mortgages? And what is the sum still covered by the moratorium? Mr. Holland is not the first who has asked for this information about the moratorium. Some estimate of what is involved should be furnished to Parliament. Sir. Holland's remedy is not impressive. Re would try to abolish mortgages as they are now; but, of course, all kinds of enterprise are financed on borrowed money, and the substitution of the State for the institution and individual as lender might gravely clog the wheels of industry and commerce. He would have the State take over the moratorium mortgages that could not be arranged between the parties—that is, the least favourable propositions—at the real value of the land. Where would the money come from? And would it not be better to allow things to run their course, and values to iind their real level by natural movements, than for tlie State to intervene with compulsion in this wholesale way. It is alarming to think what the taxpayer might be committed to by State intervention. The mere knowledge that a demand could be made upon the State to take over mortgages would prevent settlements from being made; and the pressure on the Government to accept financial responsibility for debts which were hopelessly bad would lead to political pressure of a corrupt character. The moratorium should go. When the statutory period is up, it should be completely discarded. It has done a great deal of harm, and, save in the early years, no good. So long as it remains in any form it will be an obstacle to the country's return to normal business methods and sound values.