URGENT PROBLEM

Otago Daily Times, Issue 23362, 30 November 1937, Page 9

URGENT PROBLEM

HOUSING IN AMERICA PRESIDENT'S AMBITJOUS MOVE MESSAGE TO THE CONGRESS (United Press Association) (By Electric Telegraph—Copyright) WASHINGTON, Nov. 28. (Received Nov. 28, at 5.5 p.m.) The most ambitious move President Roosevelt has so far made to save the United States from the consequences of the business recession is contained in a message to the Congress on the subject of private construction and financing of housing. The message said "The proposals are an important part of the programme for increasing general business activity and employment. The long continued lag in building is a drag on all industry and trade, presenting an urgent problem which is the common concern of industry and labour, and the Government. The revival must be based on a reduction of costs. Houses must be produced at prices that can be afforded by the masses. Private enterprise and capital must bear the burden of providing the great bulk of new housing. I recommend the adoption of measures to facilitate the financing of every type of housing, for which I suggest amendments to the National Housing Act in order, first, further to reduce financing costs; secondly, to extend the insurance of mortgages to types of housing inadequately provided for at present; thirdly, to make funds from institutional and individual investors more easily available for financing large-scale operations. I ask the Congress to fix the mortgage insurance premium as low as 1| per cent, on the diminishing balance of the insured mortgage on large constructions and \\ per cent, where the value of construction does not exceed 6000 dollars. I also ask for legislation to raise the insurable limit to 90 per cent, in the case of loans to owner occupants where the value of the property does not exceed 6000 dollars. A further propose measures designed to facilitate the construction of groups of houses for rent by explicitly authorising national mortgage associations to make loans on large-scale properties which are subject to special regulations by the Federal housing administration. Pursuantly, I intend to ask the Reconstruction Finance Corporation to provide 50,000,000 dollars for capital purposes, thus laying the basis for 1,000,000,000 dollars of private funds through the sale of National Mortgage Association debentures. Summed up, the terms would be the most favourable in the United States for housing purposes. Large continuous activity would put the scheme on a practical basis. Government action alone is not enough to ensure success. It will depend mainly on the willingness of industry and labour to co-operate.