INCIPIENT BOOM

Auckland Star, Volume LXXIV, Issue 197, 20 August 1943, Page 2

INCIPIENT BOOM

PROPERTY MARKET MR. NASH ON SALES TREND ("7 Telegraph.—Parliamentary Reporter.) WELLINGTON, this day. Land transactions between 1916 and 1929, the start and finish of what he described as the land boom, were reviewed by the Minister of Finance, Mr. Nash, in the House of Representatives last night, when in the second reading BSB?Sn The Servicemen's Settlement and Land Sales Bill. That pTriod, he said, had been followed Jg the inevitable slump of 1930-35 and the mortgage adjustments of 1936 and 1937. Members knew of the suffering that had been caused during the slump period, Mr. Nash continued. Now an incipient boom was coming again and the bill was for the purpose of trying to stop it. He said that for some months since he had returned to the Dominion there had been a positive demand to make speculation in land unprofitable, to provide land for returned servicemen at a price which would enable them to work it to get a reasonable living from it, to make it unprofitable to,sell and buy house properties in the sense of gambling, and to stabilise land values. j How Prices Advanced I In the period from 1916 to 1925 j the land of the Dominion, including ! town land, as well as urban and rural land, rose in price from £473 an acre to £2068 an acre, Mr. Nash said. In all 33,782,664 acres of land changed hands, and there were only 43,000,000 acres of land capable of settlement. ' The consideration Avas £293,532,790, and inside that consideration there was £14,676,640 for land agents and lawyers and in other fees, which had not been responsible for the growth of a single blade of grass". In the four years from 1917 to 1921 the price of land sold was doubled. In the two years, 1920-21, 8,000,000 acres of land were bought and sold for £98,000,000, and the cost in transfer fees was only a fraction less than £5,000,000. Quoting examples of past sales to support his contention that the Government had to guard against inflated values, Mr. Nash said that a block of land in Eltham changed hand six times in two years, rising from £30 an acre for the first sale to £95 for the last sale. There were five mortgages on -the property at the finish, and the- actual consideration was £18 16/3 an acre. The farmer at that time had to make £507 a year to pay interest on mortgages. He knew of a block on Lambton Quay, Wellington, with a building, which was bought for £11,000 and was sold four years later for £21.000.

From January to July this year transactions in town lands increased by 33 per cent over last year, the Minister stated, and in country land by 29 per cent. The consideration in town land was 58 per cent up, and in country land 69 per cent up. The increase in the average value was 20 per cent in town land and 30 per cent in country land. The actual consideration of money for the first seven months of this year amounted to £19,108,000.