STATE ADVANCES.

Manawatu Standard, Volume LV, Issue 246, 14 September 1935, Page 6

STATE ADVANCES.

With over forty years’ service behind it, the State Advances Office recently transferred its securities to the Mortgage Corporation, so that the annual report of the Department which was presented to Parliament this week is likely to be the last important document of its kind emanating from that branch of the State’s activities. Erom its inception the office hats, until recent years, been a marked feature of social legislation in this country. Earlier predictions of the likelihood of heavy losses being incurred have not been borne out. for it is shown that up to the end of the last financial year the total amount advanced was close on seventy-six millions, and the repayments in full to release securities have been over thirty-four millions, while the total losses during the forty-one years of the Department’s existence aggregate ±885,390, or ±1 3s 4d in every ±IOO advanced. The balance outstanding at March last was ±41,255,700. As with other investing institutions, the State Advances Office has had more than the usual number of difficulties to face in the shortage of income that has been experienced by borrowers in recent years. It is interesting to note m the report the actions of the Department in assuming control of town securities as mortgagee in possession. It is stated that it has confined its activities to the letting- of these reverted securities, holding that the state of the property market does not justify any variation of that policy. _ This is easily understood, in view' of many added difficulties to be encountered in any drastic change of policy in another direction, and because of the fact that these properties have been fairly easy to let, with, accommodation sorely needed in many towns. .The average amount of capital represented in the rental houses mentioned works out at ±786 per house. The rent collected during last year was 94.43 of the rent payable, but only 79.38 per cent, of the instalments payable during that period in respect of the mortgages. Relatively few cases of the sale of securities are noted. Taken by and large, it may be said that the Department has enjoved a position as good as, or even better than, many private property owners.