FALL IN LAND VALUES.

New Zealand Herald, Volume LXV, Issue 19932, 28 April 1928, Page 13

FALL IN LAND VALUES.

PROBLEM OF THE FARMER. "BROAD ACRES" SECURITY. OLD-TIME PROSPERITY LOST. " The improvement in the financial position of the Dominion has not yet resulted in any marked demand for farm property, and buyers generally appear to be taking a conservative view of values," said Mr. E. Anderson, president of the Auckland Savings Bank, in the annual report presented at the annual meeting of trustees yesterday. "It would be futile to attempt in this report to survey the manifold causes of the slump in farm—chiefly dairy farm —property values. No doubt in many instances failures were due directly to extravagant prices having been paid, the most hopeless cases being those in which men not only paid an unduly high price for their farms, but in which their purchase included more land than they could possibly develop with the limited means at their disposal. "Much unused laid is a very high quality and still remains largely undeveloped. It is situated within easily accessible and well-roaded districts, and if the way to prosperity is to be more speedily traversed, one might suggest in passing that it would appear to be wiser to develop our energies in the promotion of a scheme of early development of these potentially rich areas rather than in the consideration of propositions for opening up poorer lands in the backblocks, especially as the latter vjprk will certainly be accompanied by insistent demands for heavy public expenditure. "During the period through which we are now passing, 'broad acres,' as a security, have lost their old-time popularity. This has been caused partly by the losses mortgagees have experienced owing to the fall of land values, and because these particular losses have been associated with the realisation that the value of a farm security depends largely upon the personal element. You will, I am sure, agree, that the State cannot be expected to accept the responsibility of finding the enormous sums required to finance the purchase and development of the agricultural arid pastoral lands of the Dominion. It is evident, therefore, that the bulk of producers must continue to rely in a great measure on the private investor, and also that farm mortgages cannot at present successfully compete with other classes of investments returning attractive rates of interest. "In the circumstances, there would appear to be some reason in. the suggestion that a practical way of meeting the trouble—which shows every sign of getting worse rather than better—would be found .by the removal, or partial removal, of taxation on income derived from loans on agricultural or pastoral lands, either fully developed or in the process of active development. If some concession of this sort were made, and land valuations and the actual productive value were more in accord, there is reason to believe that 'broad acres' would regain their old-time popularity."