STATE HOUSING.

Auckland Star, Volume LVI, Issue 191, 14 August 1925, Page 8

STATE HOUSING.

» ■ ABUSE OF SYSTEM. SPECULATION IN TRANSFERS. OPENING THE DOOR WIDER. (By Telegraph.—Parliamentary Reporter.) WELLINGTON, Thursday. When the Minister in charge of housing moved the second reading of a bill to repeal restrictions on freehold dwellings acquired in respect to' workers' dwellings in the House to-night Mr. TK. Sidey (Dunedin South) urged that payments might be made to extend 6ver periods of 30 to 30 years. The Minister, he said, in this bill was removing restrictions in respect to ' sales 'of dwellings to workers only. Mr. M. J. Savage (Auckland West) referred to houses built for £600, and said the bill would enable present occupiers to sell for £1000 and upwards. That was happening every day in regard to dwellings erected by State Advances loans. The Auckland "Star" of July 29 contained no less than twelve advertisements offering dwellings carrying Government loans, and other city newspapers had also many such advertisements. Some houses were offered for sale with loans of £2000, £2200, and £2500. and one of £5000 on them. He thought the maximum advance was £3500. The amount involved on this place was £7000 capital value, yet it apparently carried £5000 Government mortgage. That was plainly an advertisement for the sale of a Government mortgage of £5000, though the amount in this case might be a misprint. At "_ per cent, which was the interest charged by the Government, the annualinterest on £1000 would be only £45, whereas at 6J it would be £65, a difference of £20, which some holders of loans were trying to capitalise at a profit. A State loan of £1000 if capitalised was worth £307 13/10, and if the holder sold the property he would net £200 on the deal. Those advertising houses for sale made a special feature of a Government mortgage. Could it be wondered at? Everyone knew the benefit of Government money at 4} per cent when 7 per cent was asked by outside lenders in the same class of security. Now Parliament was asked to an amending bill to open the way still further for this speculating with Government money. There seemed to be people making their living by trading in this class of security. The member for Auckland West declared that he had no fault to find with the 1910 Act. Under that Act dwellings were disposed of through different methods. One was weekly tenancy on a payment of 6 per cent basis, covering principal and interest. Then there was th.e_ renewable lease, and the purchase on 2... years at £3 10/ per £100 per half; year. They could do nothing like that under present-day conditions. The moment this bill was passed they were going to place people in a position of being able to sell something which probably cost about £500 for £1200. Under the 1910 Act residence was compulsory; the condition was one of occupancy and use. and the dwelling could not be disposed of without the.consent of the board until the full purchase money had been paid. The Minister of Lands (Hon. A. D. McLeod) said the prevention of selling was not going to be an easy'matter to handle The number of'people with legitimate reasons for transferring formed a -very large percentage. A large number of State servants had to move through being transferred to other localities, and there were many genuine cases of people being compelled to shift for health or other uncontrollable reasons. Then there were bad tenants of tbe State, when the Department was forced to allow a transfer.