THE VALUE AND PRICE OF LAND

Evening Post, Volume CXVIII, Issue 93, 17 October 1934, Page 10

THE VALUE AND PRICE OF LAND

(To the Editor.)

Bir, —^Referring to your editorial in last Saturday's "Post," under the caption "Value and Price," you ask the

very pertinent question;—

If landowners are still in such difficulties that an exchange subsidy is needed, how does it come about that land had a sale-demand value which the Government is not prepared to pay?

To substitute the word "price" for "value" in, that sentence would bo to give half the answer to the question. The sale-demand price is the obstacle. The other half of the answer is to be found, partly in the fact that so many owners of laud cannot sell it at its true —i.e. its productive—value, because it is mortgaged far above that point, and partly because some landowners still regard the State as "fair game" in the process of obtaining grossly inflated prices for land if the Government wants it. The Government is, for these reasons, unable to purchase pri-vately-owned land at a price which would justify the cost of subdivision and resale to selectors on terms that would.offer any prospect of success to small holders.

Your remark that "capital charges must be low" touches the crux of the matter. If the Government would direct its thoughts to the devising of some equitable means of reducing the present book values of all farm lands to true values—i.e., substitute values based on ascertained productive capacity for values resulting from land-boom speculation—and the removing of the excessive mortgage overload, the main cause of the farmers' difficulties would be overcome. So long as the Government avoids this major operation and resorts to quack remedies such as "mortgagors' relief" and "pegged exchange," just so long will any permanent recovery bo delayed. It simply amounts to keeping on baling instead of stopping the leak.—l am, etc., H.F. Nelson, October 16.