INFLATED LAND VALUES.

Waipa Post, Volume 45, Issue 3212, 4 August 1932, Page 4

INFLATED LAND VALUES.

Sir, —Mr Coates, speaking at the Empire Conference at Ottawa on July 22, is reported as saying, "Our farmers are facing difficulties which only those intimately in touch with them can appreciate. Exported farm produce in 1931 brought 10 per cent lower prices than in 1914. whereas farmers production costs remained 40 per cent above 1914. That is the gap we have to close." Mr Coates failed to say what is the greatest factor in producing this gap, namely, the inflated value of farm land during the boom period, and the huge sums lent on these fictitious values by financial institutions.

During the past six months I have been engaged in seeking for a small dairy farm for a friend. In every single instance I have found the price asked far in advance of its proportionate productive value. The nrice of butter-fat is somewhere about the same as in 1901, when was engaged in dairying in Manawatu, namely, lOd per lb. Yet land which could then be bought from £2O to £25 per acre at the outside fetches now from £6O to £BO. For second-class land near Palmerston as much as £3 per acre rent is demanded, coupled with stringent conditions ! It is this inflated value and the interest upon it which are the greatest drag upon the farmer, as Mr Coates well knows. Yet he is visiting Ottawa to endeavour to get concessions from the Home market, in the hope of bolstering up those artificial conditions, and here Mr Polson, representing the Farmers' Union, is straining every nerve and bringing every influence to hear in the same direction, regardless of the cost to the average taxpayer ! It is plain to those who can read the signs of the times that all these efforts to oppose economic law must end in futility, and that land values must ultimately approximate produce values. But meanwhile the danger lies in'the people being misled into sanctioning measures benefiting a section at the cost of much expense and suffering to the majority.—l am, etc.,