HIS HOME AND HIS CASTLE

Dominion, Volume 22, Issue 140, 9 March 1929, Page 27

HIS HOME AND HIS CASTLE

4 “The main savings market from which capital for industrial purposes is derived is definitely relieved by the efforts of building societies of an important section of capital demands: indeed, I know of nothing which is as likely to create saving? which would otherwise not exist as the psychology set up by the desire to possess a house and the arrangement made to accomplish that desire,” writes Sir Josiah Stamp in the Building Societies’ Year Book. 1 “The individual is given the stimulus to possess, and the fact that he has perhaps estimated his capacity to save rather higher than he might by later experience have desired, th<f fact indeed that his goal is set means that more is saved in this way than could' possibly be saved if left to personal volif ii.

“Real savings must find their way into objective forms, visible and real, in new houses, factories, machinery and ships; all other savings are mere appearances and are but complications of modern finance.

“Judged by every test, a building’ society saving is always a real saving. In the case of the purchase of a newhouse it is obvious, in the case of an old house purchased through the building society the purchase price is used by its recipient in some form which finds its way via bank deposits, building society deposits or shares, or company share capital into new and productive enterprise. House purchase, then, is not a little isolated transaction, it forms part of the great national flow of capital which, no matter how deficient it may have been in the past, would have suffered a far more serious shortage had not the building society movement stood where it did in public confidence in recent years; “The housing shortage may thus be said to have had its salutary and valuable side. It has been a prime inducing cause in setting up first a necessity and then a custom of home ownership and in compelling a restriction of current spending of income it has created a special habit of great value. Like heavy taxation for the sinking fund, it has its bright side and has been a means of making the individual contributions of the humbler incomes far greater than mere high rates of gilt-edged interest would ever have tempted them to be. "Furthermore, in the • great transition from the system of tenancy to that of home ownership which is still taking place in the middle classes and amongst an Important section of the working classes, no one has yet discovered any anti-social or antieconomic element. When once £lOO has been invested in the movement it does its work again and again, helping a borrower towards house purchase, returning to the particular society and passing out again into a new advance, always in beneficial circulation.”