HOUSING COSTS

Evening Post, Volume CXXI, Issue 137, 11 June 1936, Page 8

HOUSING COSTS

(To the Editor.) Sir,—l have noticed that many of your correspondents when writing about housing place depreciation at a 'flat rate of 2 per cent, to 2i per cent. Mr. R. A. Wright, ' speaking in the House of Representatives, fell into the same error. True depreciation can only be worked out on a table basis in conjunction with the interest return. To write off capital in 40 years, providing 5 per cent., 5} per cent, will be found to be the amount required per annum. If, therefore, we take Mr. Wright's own figures, allowjpg 5.? per cent, on the buildir/ and 5 per cent, on the land, instead of his 5 per cent, plus 2.4 per cent, depreciation over both house and land, we have:— £ Land. '£200 at 5 per cent 10 Building, £800 at 53 per cent. 46 Rates ' Insurance 4 Maintenance 8 Total, per annum 75 This is much less than his £93 per annum. If an additional £3 is allowed for extras we have £78 per annum, or 30s per week. Usually at the end of 40 years there is still a considerable length of life left in the house.—l am, etc., ROY H. ROLLE.