ACQUIRING THE FREEHOLD.

New Zealand Herald, Volume LXII, Issue 19133, 26 September 1925, Page 10

ACQUIRING THE FREEHOLD.

An important proposal to facilitate the acquisition of Crown lands has been embodied ih the Hutt Valley Lands Settlement Act, with the intention of giving it a general application by legislation next session. Crown lands aire now offered for selection either on lease with the right of purchase, or for sale at auction, and the freehold may be acquired either by cash or deferred payments. Instalment purchase is permitted under the same conditions for all Crown tenants —occupiers of leases in perpetuity, renewable leases and the special tenures for discharged soldiers—as well as for purchasers at auction. A deposit of 5 per cent, is required; a license to occupy the land is given, and the liability is discharged by equal annual payments over - a period not exceeding 19 years, with interest at 5 per cent., payable halfyearly, and the right to pay off the whole or any part of the outstanding amount at any time. This system of deferred payments is- embodied in the Hutt Valley scheme, except that the rate of interest is increased to per cent. In addition, there is provision for payment by instalments over years, both principal and interest being payable half-yearly. Except that a deposit of 5 per cent, is required and that the rate of interest is not fixed in the Act, these are the terms offered by the State Advances Office. The extension of the period is, of course, the important feature, its effect being to reduce considerably the effort required to clear the title of the Crown's mortgage. Under the State advances, for instance, the half-yearly instalment on a 5 per cent, loan for 20 years is £3 19s 8d per cent., and for 36i years, £3 per cent., and though the borrower has to pay £SB per cent, for the longer accommodation, the difference of almost 2 per cent, a year represents a tangible measure of relief. If these terms are offered generally to present Crown tenants and future applicants for land, a powerful stimulus should be given to thrifty se'tiers striving to acquire the freehold of their holdings, since many who hesitate to undertake the jpresent instalment conditions would confidently accept the easier terms. The necessity o£ protecting the State's interest is recognised in the provision that the rate of interest is to be fixed by Order-in-Council. But while the proposal represents an important advance in the way of facilitating the acquisition of land, its benefits will naturally depend upon the extent to which the Government makes land available for settlement. Until an active policy of development is inaugurated, it does not matter much. whether the terms of purchase are hard or easy.