LAND INFLATION.

Northern Advocate, 4 June 1920, Page 2

LAND INFLATION.

According to the "Mercantile Gazette," the inflated prices of land are eousing grave concern to bankers and managers of loan and building societies. Prices ranging from £120 to £150 per acre for farm land have not been uu-

common, and even ordinary grazing land is priced at £30 to £45 an acre and more. "Obviously the values of today are based on war prosperity, that is, on the present extreme values of produce. If these values can he maintained indefinitely, then the high values of hind will continue, and be justified. But it will be admitted by anyone who has given the subject the least consideration that the present high level of produce prices cannot be maintained for any length of time." No one knows when prices will fall or at what rale, bin ii would uol require much of a decline to put many landowners iv New Zealand in a serious lix. As the "Gazette" points out, speculation is doing a great deal to help inflation, and sometimes a single property will carry three, four, and five mortgages. When prices fall, what is going to be the position of the fifth and fourth mortgages? The Prime Minister some days r ago issued a very sensible warning to the country, pleading for the exercise of "care, economy and industry." So far as the Government is concerned economy might well begin at home, since the cost of administration in New Zealand has grown by leaps and bounds during recent years and still is uncurbed. But the people generally should also take heed of the warning. This country has been exceedingly prosperous, but it seems certain that prices will fall and people will have to manage with a great deal less money than they have become accustomed to handle. The 'primary producers are threatened with grave difficulties, and Mr Massey has practically promised to undertake the big task of financing them. This will mean a substantial addition to the country's financial burden, and the higher -land values go the worse the position will be.