Real  Estate   Record





AND BUILDERS' GUIDE.





Vol. XVIII.





NEW YOBK, SATURDAY, DECEMBER 2, 1876.





No. 455





Published Weekly by

Cljfi gea,( (Estate %uaxii %SBQcmixan,

TERMS.
OXE YEAR, in advance....$10.00.

Communications should be addressed to

C.  W.  SWEET,

Nos. 345 AND 347 Broadway.





THE SITUATION.
AVe are frequently caUed upon for an expres¬
sion of opinion as to the present conditions and
future prospects of the real estate market. With¬
out claiming any monopoly of information or su¬
periority of judgment in the premises, we do
claim a larger coUection of facts and a closer and
more continued reflection upon them, than is pos¬
sible to the ordinary citizen immersed in his busi¬
ness affairs.

WhUe we present a weekly market reAdew, in
which we aim to gather together the prominent
occurrences and floating gossip of the trade, -we
by no means Avish to con-vey the impression that
the real estate market, like the other great staple
markets of the city, is subject to daUy, Aveekly or
even monthly fluctuations. On the contrary,
the fluctuations of the real estate market consti¬
tute great epochs or cycles of appreciation or de¬
preciation; the subtle and impalpable forces,
which underUe these great changes, are the proper
subjects for editorial and phUosophic study. To
forecast these periods of ascension or declination
of values, to reap their full advantages, and to
escape their certain disasters constitute the busi¬
ness of the successful operator in real estate. We
aim to fuMU our function of chronicler of the
vast interests concentered in the real estate mar¬
ket, unbiased by prejudice, interest or associa¬
tion, contemplating their fluctuations from the
calm standpoint of professional observation.

It is often said that no two panics are alike, and
the experience of the past three years justifies
this assertion. However periodic they may ap¬
pear, and subject to weU defined laws of poUtical
economy, it is nevertheless true that each recur¬
ring one presents new aspects and phases, and has
iuA^riably led to new conclusions and results.
Without aiming at a study of the general laws
governing the mercantUe and financial Avorld, or
attempting their elucidation, we feel ourselves
fuUy competent to deal Avith the phenomena of
cause and effect as they present themselves Avithiu
bur special domain. As the various steps in these
great cycles of our market develop themselves,
whether of progression or retrogression, we shall
deem it our office to depict the panorama of events
in frue and liAong colors.

General.—^The real estate market is character¬
ized in its general conditions by extreme didness,
the outcome of stoUd apathy and prolonged and
obstinate inertia. To properly analyze this con¬
dition, Ave must recur to recent history. The
whole real estate community was simultaneously
acted upon by the spurious though encouraging
influence of the inflation movement inaugurated
by Secretary Richardson in the midst of the
panic of 1873. It-was hUtiated Avith so much ap¬
parent confidence and concurrence on the part of





the leaders of the adimnistration, that it afforded
strong grounds for the belief that a continued
inflation of the currency was to mark the poUcy
of the future. This hope -was stUl further fos¬
tered by the subsequent action of Congress in
their various discussions of cun-ency measures
dm-ing the spring of 1874 untU their final culmina¬
tion in the great veto by President Grant in the
summer of 1874. The interval between the initia¬
tion of this new scheme of inflation and its over¬
throw, being a period of almost ujne months, was
a season marked by the highest exaltation of the
real estate imagination, and, in consequence,
values were nominaUy and ostensibly carried to
an altitude never before experienced in the history
of city real estate. This was accompanied by a
willingness on the part of private capitaUsts and
leading institutions during this term to loan
money freely on the basis of the exorbitant prices
then ruling; and, strange to say, notAvithstanding
the high prices, a current demand was developed
during the spring of 1874 that aU but equaUed the
extraordinary and unprecedented demand of the
spring and summer of 1868.

It is painful to record how immediately these
high hopes were dashed to the ground, how with
one stroke of the pen the Avhole upward move¬
ment and tendency of real estate was declared
false  and  abnormal,  how  the  market values,
struck almost into insensibUity by this potential
blow, quivered for a AvhUe at their apex, then
suddenly drooped and subsided into a  decline
whose unbroken and steady decliAdty has lasted
imtU the present day—a decline whose end or re¬
covery it is impossible even now to foreteU in the
absence of Avholesome financial legislation on the
part of Congress, and in the midst of aU the con¬
fusion and uncertainty which envelope our poUt¬
ical situation at the present time.   It Avas fondly
supposed and proudly boasted of by the great ma¬
jority of active real estate operators, that their
special interests had escaped unscathed from the
terrible crisis of 1873, that under the seemingly
favorable auspices of Congressional legislation a
new era of prosperity was about to be inaugurated.
Since that eventful summer of 1874, the real
estate market, to borrow the language of surgery,
has been in a state of shock or s3mcope, from
which its inherent strength and vitality have not
yet been equal to the effort of recovering it.   We
can readUy see that the strength of the patient
was unequally distributed; that, at some points,
the numbness of total coUapse is apparent; at
others, the vital forces playAvith greatly. Aveak-
ened activity; and at stiU others, the life currents
flow from time to time with sufficiently quickened
acceleration to afford the expectation of an early,
partial or   perhaps complete  recovery.    There
are  many shrewd and clear-sighted  operators
who claim to foresee stUl harder times in store
for the real estate market, than have yet been
experienced.   There are others, who discern in
the  prolonged lethargy  nothing more than  a
-wholesome rest for the overtaxed and overstrung
energies, of ihe market.   StUl others hold to the
view of an early, prompt and complete recovery
of the now prostrated  mai-ket, claiming  that
within a twelve month it wiU start again into
life, with renewed vitaUty and quickened im¬





pulses, and once more assume its accustomed
place among the leading Arital interests of our
city.

Being aware of the maxim, that prophets are
without honor in their own country, we venture
diffidently upon any assertion as to the imme¬
diate future.   We prefer to adhere, as safest and
Avisest, to a moderate and conservative course of
reasoning;  and  place our hopes of the future
more upon a gradual, though slow recovery and
steady,   though,  smaU  accretions  of  strength,
rather than upon sudden bursts of -vitaUty, which
are only too apt to be the ephemeral results of
strong tomes and violent stimulants, and to be
foUowed by the inevitable relapse.   We know
and appreciate aU the evidences of strength which
the condition of the market plentifuUy affords.
We are also acutely aware of its many sources of
weakness.    But we  cherish  and maintain the
strong conviction that the real estate of our city
wUl in due course of time, and at no very distant
period, be as much sought after in its various
shapes of improved and unimproved property,
CA'en though on a low plane of values, as it ever
was, in the time of kiting prices and baUooning
values.    The   groundwork of  our faith is the
general assertion that the land of our city, for the
purpose of business or residence, immeasurably
transcends in desirableness that of any other part
of the country; and that, sooner or later, such a
low stratum of prices wUl be touched as will
cause the redimdant capital of the country to
floAV steadily in upon its fruitfid and proUflc soil.
At the present time, however, truth compels us
to admit tbat the market remains in an anom¬
alous and phenomenal state.   It is undergoing a
noiseless panic, in which there are scarcely any
legitimate or lona fide sales, by which market
rates might be established and critera of values
set up.   The first stage of this noiseless panic has
witnessed wide-spread foreclosures of defaulting
mortgages, in which the mortgages represent so
large a share of the intrinsic value that the mort¬
gagees have been obUged to stand with extended
arms to catch the properties as they f eU beneath
the auctioneer's hammer.   In the absence of any
actual legitimate demand on the part of investors,
it has been left for the lenders on mortgage to
approximate and define the relative or supposed
values of property.   Whether these values, thus
artificiaUy created by them, for the purpose of
their special function, to wit: the lending   of
money—^vsdU remain permanent and fixed for a
period of years, is a problem, which the lapse of
time only wUl be able to solve.   It is certain, they
are estabUshed on a low conservative plane, and
with any recuperation in the business interests
and industries of the country these values could
hardly fail to be realized.

But it, as apprehended by some, another stage
of this noiseless panic awaits us, -viz., the time
when mortgagees, including corporations as weU
as indiAriduals who have become the involuntary
owners of property imder foreclosure, shall,
through the lapse of the legal period -within
-yyhich they are allowed to hold such property,
or through sheer irksomeness of the bm-den im¬
posed upon them, be obUged to enter the market
in large numbers with extensive blocks of proi>-