Real Estate Record

AND     BUILDERS'    GUIDE.





YoL. XVII.





NEW YOKE, SATUKDAY, JANUARY 15, 1876.





No. 409.





jPublished "Weekly by

THE REAL ESTAfE RECORD ASSOCIATION

C. W. SWEET...............Peesident and Teeasueer

PflESTON I. SWEET...........Secbetaet.

L. ISRAELS.........................Business Managee

TERMS,
ONE YKAR, in advance___$10 00.

Comnaunicatlons should be addressed to

Nos. 345 AND 34i7 Beoadwat.

THE CRISIS IN REAL ESTATE.





YII.

BECAPITULATION.

We have heretofore explored and expounded
what we believed to be some of the potential
and efficient causes of the existing obstinate
and baffling crisis in real estate affairs, and
which threatens to mark a memorable historical
epoch in the life of this interest. These causes
we wUl now briefly summarize. We have
treated:

First—Of the expansion and subsequent collapse of
values arising from the vicissitudes of an' in¬
flated and irredeemable currency.
Second—Of the lethargy that followed the panics
of 1857 and 1861, and the natural reaction that
succeeded it.
Third—Of the exaggeration of values due to the
completion of Central Park, grand boulevards,
aud other prominent public works.
Fourth-Of the consequences of an extravagant

and sensational spMt in architecture.
Fifth—Of the machinations of the Tammany King.
Sixth—Of the abuses of the building loan system.
Seventh—Of the abnormal conditions of labor.
Eightli—Of the lack of rapid transit.
jSinth—Of oppressive taxation.
Tenth—Of   brokers and   auctioneers,  and   their

methods.
Eleventh—Of the appUcations of Wall street tactics
to real estate transactions as   Illustrated by
pools and rings.
Twelfth-Of the falsification in deeds and pub¬
hshed records of the consideration or purchase
money of real estate.
Thirteentli—Of the abuse of trust fiinds by savings

banks and insurance companies.
Fourteenth—Of the abihty and non-ability of legit¬
imate buyers to invest in real estate,

-Of the evils resuitiag from legislative
action'and non-action.
Sixteenth—Of the nature and consequences of debt

secm-ed by bond and mortgage.
Seventeenth—Of rivalries-, their possibilities and
antidQtes.
We have aimed to set forth these root causes
succinctly and perspicuously,-without attempting
to exhaust or elaborate thenii But with the sole
view of eontributihg oiir share towards the so¬
lution of the anomalous and involved situation
now and for some tiine past existing in the real
estate market, and in. the hope that our discus¬
sion might incite more experienced minds to
treat of the diagnosis and prognosis of the pa¬
tient's malady.   Dm-ing the long pause which





Fifteenth-





will assuredly settle upon real estate interests
pending the resumption of specie payments,
abundant opportunity will be afforded for reflec¬
tion and comment.

Upon the threshold of another century of our
national existence, and in the presence ot a
world-wide stagnation and revulsion in business
affairs, the season is opportune for a critical and
analytical review of the past for the rt^currence
to fundamental principles and bases, for the de¬
tection of errors and inconsistencies in our
methods and practices, and for the preparation
of a broad and comprehensive, but stable and
perpetual foundation, on which to rear the finan¬
cial, political and industrial structures of the
coming century.

We may have been suspected of sinister and
ulterior designs in our endeavor to depict the
real situation of the special interests we repre¬
sent.   We have been accused of painting the
picture in gloomy colors; of catering to the in¬
terests of capitalists; of decrying the value of
property and despairing of the future of our
metropolis.   We appeal confidently from such
judgments to the tribunal of public opinion.
We might falter in our estimate of the situation,
and question the correctness of our conclusions,
were we lacking in the spontaneouB and impar¬
tial expressions of approbation which we have
constantly received from judicious and experi¬
enced men—^not directly connected with real
estate affairs, but representing varied interests
of our city.    We acknowledge no peer among
our accusers in honest estimate of our city's
worth.     Bred upon its generous soil, reared
amid  its   pristine;   albeit   provincial  glories,
wedded  to  it   "with   no   mercenary   or   sec-
onday   attachment,   linked   to    its   interests
by   every   sacred   and   secular   tie   that   hu¬
man   consciousness  recognizee—its   greatness
our pride, its grandeur our boast, its future the
theme of our loftiest enthiisiasm—may our arm
wither and tongue grow dumb ere we fail to pro¬
claim her surpassing excellence.    But to see her
sacred places invaded,  her temples of justice
and commerce defiled, her balls of legislation
debauched,   her   good   name  imperiled,   her
population scattered, her best citizens strug¬
gling with the burdens of accummulated dis¬
aster, her workmen willing to labor but wanting
bread, lier highways desolate and her public
places a reproach—to see all this, and more, may
well appall the stoutest heart, and force it to ex¬
claim. Woe, worth the day!

THE SECESSION OP VALTTES.

Having sufficiently elucidated causes and con¬
ditions that have prevailed in the past, we
come to treat of the present aspect of the real
estate market.

In general, we think we are justified in assum¬
ing that the point of lowest depression has been
reached and passed, or is now rapidly passing—
the period of utter ujisalableness^ of tl^e shrink¬





ing of capital from investment in real estate, of
the terror of mortgagees in becoming the forced
purchasers at foreclosure—the ice has been brok¬
en, and the plummet of real value has sounded
the depths of disaster.   Notably during the past
four months cash transactions have become suffi¬
ciently numerous and theu' real nature sufficient¬
ly known to well-informed persons to establish
and fix for the present, at lea«t, current market
prices for the various descriptions aud grades of
property.    Upon  this  newly-established  plat¬
form of values a limited number of capitalist
investors  and  house-buyers  have   evinced  a
lively interest and almost an eagerness to secure
certain of the most desirable grades of property.
The barters or trades which have characterized
the market for the past eighteen montlis signify
nothing but the transfer of burdens, and rarely
afford any inkling of real merits, owing to the
exaggerated and fictitious values with which the
owners delight to cajole each other.   But one
consideration operates to prevent the renewal of
moderate activity—that is, the unsettled ques¬
tion of rental values.    Owing to our peculiar
tradition, whereby all changes of leases are de¬
ferred until the first day of May, that point of
time is now waited for with more than anxious
interest by both landlords and tenants, buyers
and   sellers.     The   expect-ation  generally in¬
dulged is, that  the  full force   and   effect   of
commercial depression and disaster will then
assert themselves in this department of. prop¬
erty interest.    That the new levels of rental
value   are  looked   to   as   affording  the only
safe and reliable data and indices of land and
building value is now conceded on all hands.
Hopes are cherished in some quarters that the
possible influx of strangers during the Centen¬
nial year may help to buoy up rentals for an¬
other tenn.   But when we reniember how tran¬
sitory and ephemeral this demand is likely to
prove; that its acme will be reached when the
absence of our citizens in the country always
renders the supply of furnished houses to rent
largely in  excess of the current demand; that
many more than usual wUl,  through force of
circumstances,  abdicate their homes  for the
purpose of realizing their rental value during
the_ coming propitious season; that our hotels
have multiplied in number during the past year,
iand will largely increase their facilities for the
coming year; that this extra demand wiU ben¬
efit principally, if not solely, retail stores and
dwelling  property,  we will  see  how slim  a
foundation is thus presented for a bull move¬
ment   in   rents or  real   estate.   Doubtless   a
speculative   movement  in leases  will  be at¬
tempted by many a rash body, but conserv¬
ative   landlords will   give   the  preference   to
steady,    all-the year-round   tenants   and   not
run the   risk   of nine  months   of emptiness
for   the  sake of  three  months of  exorbitant
rent.   With the fair and reasonable adjustment