Real  Estate   Record





AND BUILDERS^ GUIDE.





Vol. xxn.





NEW TOBK, SATUBDAT, NOYEMBEB 2,1878.





No. 555.





fi.-





Published Weekly by

W>^t %ml €stuh %mx)s Association.

TERaiS.
ONE YEAR. in advance....SJO.OU.
Communications should be addressed to

C.  W.  SWEET,

Nos. ;145 AND 347 Broadway





THE COMING ELECTION.

It is not within the province of this jourual to
discuss political issues or to express partisan pref-
erences; and yet the interests of real estate are so
intimately tissociated, so necessarily bound up
with matters of government that it would be an
idle and miserable affectation fora real estate
Journal, or a real estate owuer to profess indif¬
ference to the course of political events.

In the special crisis which presents itself at the
Coming election, with regard to both matters of
real estate and matters of politics, it behooves
every property owner in common with all other
good Citizens to address himself intelligently and
eamestly to the consideration of the issues in¬
volved.

What we have to say in thisconnectiou may be
briefly stated:

Amid abundant evidenees of reviving commer¬
cial prosperity, and at a time when market prices
universaily, including those of real estate, have
touched, or nearly touched, the level of gold val¬
ues; there is, as yet, no pronounced, determinabie
or satisfactory revival of real estate transactions,
and there is no apparent disposition on the part
of the investing public to embark money in our
commodity. It is useless to attempt to disguise
the cause of this apathy and indifference towards
an investment wbich under favorable conditions
might challenge the world for a peer. We have
only to turn to our annual tax bills, and compare
them with the amount of attainable rent to solve
the riddle. We all know the experience ot inves-
tors in gold and silver mining shares, where the
power of assessment is reserved by the stock Com¬
pany. The curse of such investments is that
they afford no guarantee of the continued enjoy¬
ment of profits once realized in the shape of divi¬
dends, because assessments are liable at any time
to swallow up all such dividends, and perhai«
necessitate additional outlays of capital. The
stockholders in National Banks are responsible to
their depositors and other creditors for whatever
deficiencies may arise in liquidation to the extent
of the par value of stock held by them. In the
case of the Glasgow Bank, there was unllmited
liability of stockholders, an inconceivably harsh
Provision wliich has spread ruin and bankruptcy
among the majority of the list. With what con¬
fidence can a real estate dealer invite investment
in his commodity, when this right of assessment
isso largely possessed and so arbitrarily exer¬
cised by the government. At the present time
vaeant property is loaded down-mth täxesand
assessments that amount in some cases to confis-
catibn, and in every case constitute härdships
difficult to be borne except by the veiy wealthy.





Productive property is taxed to the extent of one-
third or one-balf of the present rental income.
What expectation might the general government
cherish of enforcing an incomeltax that exacted
one-third or one-half of agiven income? Yet this
is practically what our citj- government is de¬
manding of present owners of productive real
estate.

The annual tax list shows but trifling diminu¬
tion, and that occurs principally in the item of
State taxation, while the outlook affords slender
hopes of further abatement. The rate of taxation
is now mthin one-half or three-quartei-s per ceut.
of the highest ever levied, and is higher than that
exacted under the Tweed regime. Moreover,
there is an unmistakeable and malign tendency
in the tax adrainistration of the city to exonerate
personal property and concentrate taxation upon
real estate. If the ratio of disparity between
personal and real estate taxation should be pro-
gressively increased for a certain number of
years, and it has been'an increasing one for the
last five yeare, we may expect to find the whole
bürden of taxation fastened upon real estate
alone. Already the t)anks have gained a sub¬
stantial victory in the reduction of taxation in
one direction, and as they are united and
wealthy, we may expect this success to stimulate
them to secure abatements in other quarters.
Persistent attempts have been made through
successive legislatures to effect an extensive re¬
duction in bank taxation. While we have no dis¬
position to quarrel with our fellow victims in
oppression for asserting their rights and griev¬
ances, we must insist that whatever reductions
may be urged or contemplated should be made
according to a rational system and upou the basis
of faimess and equity. The exemption of bank
capital from taxation or any appreciable reduc¬
tion of it would leave real estate saddled -with a
Ioad, which it is quite unable to bear. The very
wealthy owner alone would be able and might
continue to respond to excessive exactions, but
the most desirable element in city population, and
the one in which New York is most lacking, the
industrious and well-to-do middle classes would
be fatally debarred from any thought of real
estate ownership and wotdd be permanently
relegated to the position of tenants for over-
wealthy landlords.

The remedies for these present evils and im-
pending calamities, which are by no means
imaginary or overdrawn, can be easily enun¬
ciated.

First—The Reduction of Municipal Ex¬
penses.—A vigorous and unsparing curtailment
of expenditures should be initiated and faithfully
consummated prior to the compilation of the next
budget. Salaries should be made to conform to
the altered status of business and the reduced
scale of general profits. Superfluous outlays on
pubhc works should be entirely suspended until a
final adjustment of the tax question can be
effected. Facilities for incurring debt should be
restricted or altogether removed; and the reduc¬
tion and refunding of the present debt should be
a progressive work. 2fo satisfactory hope for
the relief of taxpayers can be expected inany
other quarter than at the hands pf the commis¬
sioners of estimate and apportionment Älter
their estimates. hare been reduced to.the mini¬





mum amoimts, other measures of relief can then
be properly and hopefully suggested.

Secon-i>—The Eqüalizatio-x ok Tax \'alc-
ATio.vs.—The present .scheme of tax valuations
is antiquated, unequal and indefensible. Build¬
ings that produce a rent of five thousand dollars
are assessed for taxation at twenty thousand dol¬
lars, whilo buildings that produce a rent of two
thou.sand dollars are taxed on valuations of
tbirty or forty thousand dollare. These irregu-
larities pervade and cbaracterize the w-hole sys-
stem. No casual tinkering or patching will
mend these defects. Commissioners must be
chosen w-ho will have the wisdom, nerve and for-
titude necessary to make a clean sweep of present
valuations, and re-constnict and re-establish new
valuations, adjusted to the unequal depreciation
of real estate aud in accordance 'sv-ith the right-
eous rule of equity and justice as betw-een indi¬
vidual taxpayers. This reform would not only
produce a larger aggi-egate of valuations, but
w-ould so harmonize these valuations as to defy
complaint, aud relieve the comraLsioners from
aniiually recurring toil and trouble. Valuations
should be established which would command the
confidence and respect of the real estate com¬
munity, and serve as fair indices to the landed
wealth of this city. This measure of revising
and re-adjusting tax valuations will be incum¬
bent on tbe commissioners whether taxes are
reduced or increased, and is especially obligatory
so long as real estate valuations form the princi¬
pal basis of taxation.

Thikd—Complete Remodeling of the Tax
System.—No intelligent or experienced merchant
would allow his business to be conducted accord¬
ing to such a loose, slovenly and inexplicable Sys¬
tem as that upon which the taxes of this g^eat
nietropolis are annuaUy le-vied. There is nothing
worth saving in the whole system. It should \m
utterly eradicated and abolished, and a new,
rational and intelligible system should be substi¬
tuted for it, embracing new sources of taxation,
with a Plethora of which the metropolis abounds,
so that relief may be afforded to intereste now
severely oppressed.

These are the considerations which demand the
earnest attention of taxpayers. We cannot but
believe that their united action would have a
marked effect in determining the result of the
Coming contest. Taxpayers must rally on the
side of economy and reform and in Opposition to
extravagance and fossilism. We have no means
of accurately determining which of the contesting
parties represeuts the true interests of taxpayers.
Neither have we any desire to intrude upon the
private ju.igment of our readers or to dictate
their course of action. We would simply admon¬
ish and urge them to weigh the measures which
we have suggested as fit remedies for the present
forlom and stagnant condition of real estate, and
to act thoughtfully in the light of their mature
deliberations. Both parties naturally promise
economy and reform before election, but we are
as pnzzled as can be the simplest voter to deter¬
mine -which promise is the more reliable.

We would recommend our constituency to vote
for that party which ■will honestly undertake to
effect a reduction during the coming yearof at
least five millions in the esqpenses of the city gov-