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|N REAL ESTATE
NEW YORK, JANUARY 1, 1916
REALTY REVIEW AND OUTLOOK FOR 1916
Market is on the Men(i, Activity ShouM Increase and
Prices Enhance—Present-day Evils Must Be Curbed
THE year 1915 touched the lowest
point in the real estate market that
has been recorded in inaiiy years. Prob¬
ably there is no better way to estimate
this falling off than by the steady, con¬
sistent decline in the number of record¬
ed instruments, including conveyances,
mortgages, assignments and leases.
What has been the cause of the inac¬
tivity, and will the decline continue, or
has the turning point come at last?
The inactivity can be ascribed to
many causes, prominent among which
might be named timidity on the part of
investors and speculators.
What Is tiie Reason?
What has been the reason for this
timidity? Has it been lack of confidence
in the stability of real estate as an in¬
vestment, or has the slump been caused
by a fee!in,g that demand for well
located, modernly constructed houses
has pasted? These questions can be an¬
swered, as a whole, in the negative. The
principal cause for the reluctance on the
part of the investing public to enter the
real estate field has been the fact
that there is no assurance where inspec¬
tions and regulations will end, or what
cost will be imposed upon the owner by
the city for maintaining and running the
There is little doubt in the minds
of the average citizen but that the mu¬
nicipal expenses could be materially re¬
duced, though should he be asked how.
it is doubtful that a logical an¬
swer would be forthcoming. Neverthe¬
less, this has been the reason for the
elimination of a large percentage of
prospective purchasers, those who have
the means but still are unwilling to in¬
vest in realty.
The same man will assert that, left
alone, real estate is the best and safest
sort of investment, one which will re¬
ward the buyer with a handsome return
on his investment—but it must be un¬
molested and the buyer assured that
nothing extraordinary will happen to up¬
set his plans.
Psychology a Factor.
Psychology also plays an important
role in the real estate field. Up to the
last fe-w months it was fashionable to tell
your friends and business associates how
poor business is and how seriously the
war had affected your livelihood. Acom-
plete revolution of feeling, however, has
come about during the last few months,
and now almost every one is a "booster"
and ready to acknowledge that business
is on the mend. This, in itself, will do
much toward righting conditions.
But there are more tangible reasons
than this for knowing that tlie real es¬
tate market is on the upward path.
Building throughout the country has be¬
come enlivened, and this always has a
stimulating effect upon the local real
estate market. When property owners
see others improve their holdings, it is
only natural for them to look around and
discover tlie reason, to find out whether
a real demand exists, and if so how can
their own holdings be improved, so as
to meet the situation, thereby increasing
the net return.
History has proved that real estate in
New York City follows Wall Street.
When there is a slump in prices among
securities, realty feels the effect some¬
what later, and the reverse is also true,
for following a Wall Street uplift a rise
in realty values follows. Wall Street
has had a boom of no mean proportions
during the past few months. It is fair
to assume that realty will feel the re¬
bound, unless all previous signs fail.
Auction Market Situation.
Taken in its entirety, the auction mar¬
ket did not come up to expectations.
Many of the properties went back into
the hands of parties in interest, at prices
less than the known incumbrances. On
another page in this issue is printed a
table of all the properties offered to the
hi.ghest bidder which brought more than
$10p,000. These figures show an inter¬
esting condition. The cheaper parcels
brought somewliat more lively bidding.
The vacant lot offerings found buyers
and the properties have been well dis¬
The settling of the rapid transit situa¬
tion, the large amount of work actually
completed has done much for realty in
the sections near and adjacent to the
routes. This applies to the properties in
the outlying sections as well as in Man¬
Mortgage money has become easier
during the last few months, and the loan¬
ing institutions are more ready to loan
upon good properties or building opera-
tio.is than for some time past. This is
remarkable in view of the tremendous
sums of money required to finance the
European war and the drains that are
made upon the citizens of those countries
who reside in the United States. The
question of amortized mortgages is now
prominently before the loaning interests
and the result will have.great bearing on
the real estate market.
Much interest was manifested in legis¬
lation in Albany at the last session by
the real estate organizations. Never
were they so faithfully represented at the
capital. Committees were posted there
all through the session to watch out
against bills inimical to realty, and to
urge the passage of those which would
relieve it from unjust burdens. A num¬
ber of hearings drew large delegations
from the allied associations in this city.
Labor Law Influences.
Local hearings on a proposed revision
of the Labor Law had held out the hope
of a genuine modification of some of the
drastic laws therein contained. A bill
was prepared by the Conference Commit¬
tee of Real Estate and Allied Organiza¬
tions and introduced by Senator" Lock-
w'Ood_ and Assemblyman Ellenbogen to
simplify building inspection in thTs city.
It passed both houses by large majori¬
ties, \vas the subject of two hearings at
the City Hall (one by a joint Legisla¬
tive Committee and one by the Mayor)
and at the last was vetoed by the Mayor
\vhen there was insufficient time to pass
it over his veto.
A bill embodying a revised Labor Law,
prepared by the Joint Legislative Com¬
mittee of which Senator Wagner was
chairman, and designed to add more
power to the Industrial Board, aroused
great opposition and failed of passage.
Instead, a bill was enacted abolishing.the
Industrial Board, and the office of Com¬
missioner of Labor, consolidating the
board with the Compensation Commis¬
sion, and directing the appointment of
five new industrial commissioners, from
which Realty hopes for better things than
came from the old board.
A bill was passed by the Le ' '"re
providing for an investigatior. of the
State system of taxation (which the Mills
committee is carrying forward), and an¬
other bill was passed lor an inve tigation
of the fiscal affairs of New Y jrk City
(which the Brown committee is : -jW pro¬
ceeding with), and from both 'if which
committees the taxpayers hope for meas¬
ures of relief.
The most important legislation which
may be classed as revenue legislation af-
fecting_ the city of New York was con¬
tained in six bills, now six separate chap¬
ters of the Laws of 1915, relating to the
condemnation of real property for pub¬
lic use. Another bill which became a law
greatly enlarged the powers and possible
usefulness of the State Tax Commission¬
ers. An injury which more than coun¬
teracted all the good to realty from the
Legislature was contained in the pas¬
sage of the bill levying a direct State tax
For the coming session the real estate
and commercial organizations of the city
are preparing a bill designed to meet the
approval of the Mayor and Board of
Estimate and having for its object the
relief of property from the annoyance and
expense of over-inspection. Relief meas¬
ures are also expected from the Legisla¬
tive committees which have been investi¬
gating the State tax system and New
York City's fiscal affairs.
Builders a Factor.
Speculative builders have been the
principal purchasers of large corner
plots, the Park avenue and West End
avenue sections being prominent as far
as apartment house construction is con¬
cerned. The district west of Broadway,
between Herald and Times Squares came
in for considerable prominence as far as
mercantile construction was concerned.
In the Flatbush section of Brooklyn
a number of high class apartment houses
have been erected in the side streets,
while some construction of similar char¬
acter has been witnessed on a few of
the main arteries. On the west side of
Prospect Park several elevator apart¬
ment houses have been built or projected.
In Bay Ridge the two-fam.ily and
semi-detached dwelling has given away
to the four-story brick tenement. On
the avenues stores are installed, while in
the side streets this feature is eliminated.
The major portion of the improvements
has been along the route of the new sub¬
way, though at the present time there is
a distinct trend beyond the present lines,
discounting future rapid transit.