LOSS SHOWN

Evening Post, Volume CXXX, Issue 22, 25 July 1940, Page 12

LOSS SHOWN

I STATE HOUSING . ■ RENTAL HOMES REPORT ON SCHEME fc A'loss of £2569 15s 6d 'on pn> pertics erected under the State housing scheme for rental is shown in the annual report on State housing 3 which was presented to Parliament "! yesterday, .as part of the State AdJ vances Corporation's annual report. : ; The report also reveals that the in--1 tercst rate on the financing of the 5 scheme was under 2 per cent. , I "The revenue account for new State rental houses shows a loss of £2569 . 15s 6d for the year after making prot vision for maintenance, depreciation, [ and other items of expense, including \ a charge for interest which for the year averaged 1.9216 per cent," the rer | port states. The tabulated revenue account shows rent totalling £325,317 5s . i4d, and expenditure of„ £327,887 03 10d,' the excess of expenditure over i j receipts transferred to the profit and T loss account being £2569 15s' 6d. The [ expenditure is itemised as follows:-— ; Interest, £121,699 18s 9d; management [ expenses, £26,650 5s lOd; depreciation, i £48,377 0s lOd; -insurance, £13793 15s r 3d; rates, £59,000; maintenance, £55,175 0s lOd; losses and vacant ten- [ ancies, £3190" 19s 4d. [ "Land for housing purposes has now J been purchased .in 127 towns," states the report. "Owing to the growing . -scarcity of serviced sections the Department has had to acquire a con- [ siderable area of undeveloped land, ; the preparation of which areas for ; housing purposes involves a tremendous. amount of preliminary work in i the way of construction of roads, foot- ; paths, water supplies, storm-water, and : sanitary sewers. In view of this necessary preliminary work the Departmentis required to purchase land well in advance of the actual construction of L houses. To date, the Department has ; purchased approximately 18,000 build- ; ing sites. ; BUILDING OF FLATS. "The Department is continuing to ; erect small numbers of pensioners' • flats in the larger towns throughout the country. The block of fifty units , being erected at Berhampore, Welling- ; ton, is nearing completion. Tenders have been let for eight flats over and . adjacent to seven shops in Waterloo, Lower Hutt. These flats are from two to three rooms with all conveniences. "Working drawings are being prepared for a building of 116 two-roomed flats with all conveniences in Dixon Street, Wellington, also for a group of fiat buildings that will contain 100 units ranging in size from two to four rooms with conveniences . in Jackson Street, Petone, and a small block of 11 ' units of two rooms with conveniences at the corner of Wakefield Street and the Main Hurt Road. I "The total number of houses • completed and handed over to .s.the State Advances Corporation: for 'the year ended March 31, 1940, was-3395. At March 31 the total number-of persons engaged on housing-construction and on subsidiary work such as roads, sewer schemes, water supply, etc., was 5594, of which number 370 represented the staff of the Department. . "Up to March 31 the total net payments in respec 4 - of the purchase of land, provision of services, erection of joinery factories, erection of houses, and all administration charges amounted to £10,647,201. Liabilities and commitments as at that date amounted to £3,200,565. The net expenditure for the year under review was £5,136,699. "The total cost of administration of the Department of Housing Construction, exclusive of interest charges on capital moneys invested from its inauguration to March 31, 1940, i 3 £275,512, of which sum £132,628 represents the expenditure for the financial year 1939-40." NEW LOANS. The report shows that 2111 new loans, aggregating £1,868,368, were granted during the year. Loans granted for house building numbered 1617 and took £1,540,130 of the total. There were 494 loans for other purposes. The total number of loans under administration at the end of the year was 66,482, the value being £51,394,200. "The lending rate for first mortgages remains unchanged at! 4 1-8 per cent., and this rate has been maintained since 1935," the report states.."The Corporation's main lending policy is allied to long-term table mortgages. For house-building loans the' terms vary according to the type of building and the circumstances of the borrower, and for suitable farm securities the maximum term is forty-five years. "The adjustment of mortgage accounts arid the improvement in prices for farm produce during recent years have naturally had a beneficial effect on the financial position of the Corporation's mortgagors, and it is pleasing to report that the payment of instalments during the past financial year has shown a still further improvement. It is estimated that the amount received on account of interest due to the Corporation represents approximately 99 per cent, of the amount due. The majority of mortgagors have also been able to meet the principal instalments due under their mortgages, and the funds' received from this source have thus been available for the making of further investments on new loans. Interest on mortgages, current accounts, and other investments for the past year, amounting to £2,279,665 4s Bd, shows a comparatively small increase over the previous year's return of £2,250,102 13s 6d, which is consistent with the balance-sheet position—i.e., the loans outstanding at the end of 1939 and 1940 are approximately equal. The Corporation's annual commitments on account of interest payable on borrowed funds necessitate the accumulation of substantial funds to meet the instalments on half-yearly due dates, and during the past year the board found satisfactory temporary investments for a considerable proportion of these funds, the interest return from this source for the year being approximately £13.000."