Northcote Settlement.

Press, Volume LXVI, Issue 19918, 3 May 1930, Page 14

Northcote Settlement.

It would seem that the Northcote Settlement must now be regarded definitely as a failure. Of the fiftysix houses built no - than forty are unoccupied,, and these are likely to remain unoccupied unless some drastic action is taken to reduce' prices in sympathy with.the heavy decline in the' value of house property during the past year or two. The Settlement was established some years ago in response toapopular clamour over the shortage of houses for workers—a shortage' that resulted largely from the operation of •the special legislation depriving landlords of many of their most material rights and transferring- those rights to the tenants. This action, as might have been expected, put an end to house property as an investment And to the building of new houses for letting purposes. When the inevitable, shortage came.- demands were , made upon the City Council and the Government to provide houses for those 'workers who could not rent them; and t since people would not listen to a sug-. gestion that cheap houses should be built; the Council proceeded to build bouses of a quality and at a cost Which one prominent member of the Council declared was more than he himself could .afford if he were a prospective occupant. The • Council however-, wasfortunate iu disposing of its housing properties, though not iit, all cases to the, people intended tp be benefited.

The Government was not so fortunate. As the clamour for more houses continued, it acquired a block of land some distance beyond the Papanui township and established the Northcote Settlement, at a cost for each property of something like £llOO. The Settlement never proved popular, and it may have been that the houses were really too expensive for the workers and that people who could afford to pay the price preferred to purchase elsewhere where they could secure an ordinary independent ownership as distinguished from a Workers' Settlement. For these, and other special reasons connected with the state of the property itself, the Settlement languished from its birth, and has at no time fulfilled the purpose for which it was intended. When the general decline in values arrived the price placed on the houses was reduced from £llOO to £9OO, and there are still forty on the hands of the Department. If these are to be disposed of the Department must meet the market. Most land-owners in the Dominion, including farmers, have had to suffer severe losses due to declining values, anil not even a Government Department can expect to escape the operation of economic laws. If the houses cannot be disposed of for £9OO, then they should be offered for £BOO, and if that will not attract buyers the price should be reduced to £7OO or gome figure that will effect a sale. The Department is bound to suffer a big loss, and the sooner it realises the position the better. The alternative is to retain a wasting asset which is gradually being eaten up with interest and other charges, and the longer the realisation is deferred the heavier will be the loss. The Settlement is another example of what happens when, the State dabbles in affairs which shoulu' be left to private enterprise. There is this justification, however, that the Government at the time established the Settlement as an emergency measure to meet what it was assured was a most desperate situation regarding housing.. If it blundered, it was in accepting these representations at their face value.