RENTS FALLING

Grey River Argus, 5 February 1930, Page 2

RENTS FALLING

In the Cities AUCKLAND, February 3. Auckland land agents report a continued fall in house and office rent..;, which have reached their lowest level since the war. Several agents stated yesterday that rents for suburban homes have dropped 20 to 30 per cent, during the la£t three or four years. “Our experience would show that 30 per cent, is conservative,’’ remarked a representative of a city firm which does extensive business in city and suburban properties. “It is mu<h more like 40 per cent. I could mention scores of such cases'. For instance, a house in Ponsonby which has been on our books for many years, was fetching £2 10/- in 1024. To-day it has been let for 17/6. Another house in the same district was let for £2/12/- four years ago, and now earn*' only 30/-. Houses in Eps'om, which we let for £2 to £3 a few' years aga, are let for 20/ to-day, and owners are glad to get it. The history of one house is the history of the whole pro perty market. There is a serious slump in house property.”

The position was the same with regard to city offices, he added. Land lords were faced with heavy financial loss if they failed to heed the prevail ing tendency. Auckland is evidently overbuilt, judging by the following extract from the “Star.”

“Agents say that numerous houses built with Government money are empty to-day, the occupiers having failed to keep up their interest and capital payments. One well-know.i house agent in the city is convinced that the time has arrived when trie Government should consider the. advisability of recasting its policy in connection with advances for home building. This agent takes the view that it is unsound economically to contiuue lending money for now homes when there are so many unoccupied houses in the city 7 and suburbs. Hbme building is continuing steadily in inc city, an average of 460 having been erected annually in the past three years, while new houses in the outer suburbs have gone up by the thou sand. ’ ’ WELLINGTON, February 3. The state of affairs in Auckland, where it is estimated there are 14v0 empty houses prompted a reporter r i 'make some inquiries of land agents l.ejf: with a view to ascertaining whether building activities had caught up on the undeniable housing shortage existing a. year or two ago. There is as yet apparently no falling off in the applications for building permits in Wellington, in fact, .t--seems likely that the year 1930 wnl constitute a record if it proceeds as it ha. 4 started. There is no doubt that Government loans, enabling people to build with small deposits, have cause . a great spurt in home building, particularly, in the suburbs, and that many of those »wno have secured the Government money have not yet built, so that it is-sare to assume that there will be no immediate falling off ; .n building by private persons for residences', though builders may have curtailed speculative construction. Ono Wellington agent said that in his experience failure to keep up payments did not exist to the same ex

tent as was stated to be the ease in Auckland, nor was the shortage reallv yet caught up here. “It is true that we have a few houses to Jef all the 'time, and that latelv rents have bee i slightly easier but there is no defin ,ite surplus of houses. I would say that, from n slight shortage, the posi lion has now become normal. There is certainly 7 an over-supply of houses in New Zealand everywhere, save in Wellington. Here we have now a fun supply of houses, but not an oversupply. Building will go on as* long as builders can sell the houses well. The instances of failure 10 pay inter jest that come under my notice are du-i to misfortune, and those do not exceed the formal. The. position locally • " nothing like what it is in Auckland, where in one issue of a nowspap« r

nineteen mortgagee*’ sales were advertised. Occasional mortgagees’ sales arc advertised locally, but that has been the case for years.” Another agent took a more decided view of the position. “Building has met the. existing requirements,” ho said, “both on houses, offices, shops and warehouses if it has not exceeded them. Shops in good positions, and well-built houses of from five to seven rooms find ready tenants at teas >iable rentals. Larger houses have io reduce their rents before they ar; taken. The demand for buildings tlvw can be converted into flats is small. Government money has given a. fillip to building at the expense of the pri vote mortgagee. The Government money is all right for the small man ’building for himself.” FALSE REPORTS CORRECTED. WELLINGTON, February 4. The Superintendent of the State Ad vaaietto, when approached, 'said ’that conditions in Wellington did nor justify similar action to that taken at Auckland, where it was estimated that 1400 houses wore vacant. The de vision affected Auckland only. The announcement that no more loans would be made in Christchurch was incorrect. There had been some misunderstanding.