A RENT QUESTION

Dominion, Volume 19, Issue 253, 9 July 1926, Page 4

A RENT QUESTION

AUCKLAND STATEMENT CORRECTED. “Anyone occupying a house in 1911, when the war broke out, was required only to pay a rental equalling 7 pci cent, on the value of the house in IJII. The point is that a tenant who was iu tho house at that time ean stay .there for the rest of his life and pay only that 7 per cent., while others are paying current rents.” 'Referring to the above statement, which was made by a land agent to an Auckland “Star” reporter, the Secretary tor Labour (Mr. F. \V. Rowley) remarked yesterday that it was incorrect. The rent allowed by the Act was increased in 1920 from 8 per cent, gross (on the 1911 capital value) to 7 per cent, net, that is to say, 7 per cent, in addition to an allowance by the Magistrate for rates, insurance, maintenance, aud depreciation. This alteration was made because the charges mentioned vary between wooden and brick or concrete houses, and also between old and comparatively new ones. lor example, the insurance on a woeden house would bo about Ils. per £lOO, with a risk of nearly a total loss, while lor brick or concrete it was only about. 3s. with a risk of losing less than halt. Thus for a wooden building worth £9OO, tho insurance risk was, say, £B5O at Ils., equal to £4 13s. 6<l. per annum, and for a brick building of the same value tho risk, at 3s. on a third of it, equalled only 9s. Thero was a further saving with brick or concrete in furniture insurance rates. Tho difference was considerable, and the maintenance was also much less for a brick house. The effect of the 1920 legislation is best seen when an old house is compared with a new one, Mr. Rowley continueo. For example, the depreciation allowance required for a new wooden house worth, sav, £9OO, with :i life of 361 years, would bo' about £9 p.er year (1 per cent ), while the saino house, if ll>- years old, would be worth, ‘.ay. J.W nnd woulu require n depreciation allowance of about 21 per eent. for the remaining -0 years of its life.