STATE LOANS ON HOMES

Evening Post, Volume CXVII, Issue 49, 27 February 1934, Page 8

STATE LOANS ON HOMES

Landlords frequently complain of losses'incurred on rented/houses during a depression,'but the' Rural Bank of Neiy South Wales seems to have been able to use tenancies in order to preserve the' right of a dis-possessedhome-ownef. According to figures supplied by, the. Premier of New South Wales; the Rural Bank has had to; enter into'.possession5 in about IQO0 'cases, but the original purchasers have "hot lost their equity, because the rental paid for the house by a tenant has been' more than sufficient to meet the interest on the original purchaser's loan: That is to say, a home-owner who -loses employment; and cannot pay interest vacates the home; somebody else who has not lost his employment pays" , the interest/ (but calls it rent); the home-owner on regaining his employment regains home and equity. So well have tenants come forward to pay the interest of the owners that during the last financial year the Rural Bank made only twelve' sales, terminating owners' rights,; This is la remarkable sidelight on/.the depression, and on the capacity of the Rural Bank, as mortgagee, to keep its Sydney homes in economic occupation during borrowers' default. Another sidelight is that the Rural Bank has resumed lending for homebuilding, offering a 75 per cent, advance (which a Government 10 per cent, advance raises to 85 per cent.), and that holders of its. debentures last October accepted conversion at parjfrqm 5| per cent, to a.4 per cent. basis^---although there was a time in the Lang regime when buyers would not offer, inpre^than £50. for the 5£ per cent;stockv';':-/'v. • . : .';.'-'■'