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Real estate record and builders' guide: v. 20, no. 503: November 3, 1877

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Real Estate Record AND BUILDERS' GUIDE. YoL. XX. NEW YOEK, SATUEDAY, NOYEMBEE 3, 1877. No. 503. Published Weekly by C^e %ml €siatc %nax)i %^^atmixan, TERMS. ONE YEAR, in advance.. ..$10.00. Communicafcions should be addressed fco C. W. SWEET, Nos. 345 AND 347 Broadway. THE PALL REVIEAV. If we Avere asked to characterize the tone and temper of the real estate situation, we should be able to do it in a single expression—intense legiti¬ macy. The whole market is pervaded by a con¬ servatism and monotony, like that pertaining to the shovel or broom business. AVhile there are exceptions to this general statement, they only serve to demonstrate the rule, and duy specula¬ tive manifestations are of a mild and harmless character and Ukely to be self-corrective. Here and there a landlord may elect to take the prom¬ ise of high rent in preference to undoubted security, and doubtless may continue in this frame of mind until a series of disappointments in the collection of rentals induce him to forego the empty benefit of nominally high rates, Avhich totaUy fail of realization. Likewise there are certain lenders, Avho, for the sake of realizing the maximum interest, wiU strain and tax the margin of security very severely, and offer loans which represent Avithin ten or twenty per cent, the fuU cash value of property. The chance—we had almost said the certainty—of property thus heaAoly mortgaged faUing into the hands of the mortgagee wUl prove the antidote to such a courageous poUcy. particularly if the mortgagee is averse to the OAvnership of property. There is also a small outcropping of speculative spirit in. connection with buUding loans—a dangerous business when unwisely and unknowingly tam¬ pered with. It carries not only a corrective effect, but is apt to enforce a penalty for undue rashness. There is not the slightest manifestation of any speculative movement in unimproved property, the holders as a rule being desirous of reaUsing on their present possessions, whUe very few outside capitaUsts have yet mustered the courage to embark as investors. We think we see the prospect ahead of close, hard dealing and severe, honest work ill all the various markets for real estate. Rents AvUl necessarUy have to be gauged to the capabiUties and possibUities of tenants, and land¬ lords wiU have occasion to exercise a large share of forbearance in enforcing their demands of rent coUection, and a wise and Uberal complaisance in the matter of repairs in order to secure the besfc tenants. Lenders of inoney who desire the amplest security—Avithout which the mortgage investment loses its character and merit—^must be content Avith a reduced rate of interest. Lot owners, in default of any investment or specula¬ tive demand or any indications looking to such movement, must be content to hold their property until the development and growth of the city requh^e it for improvement, and then be pre¬ pared to offer it to the buUders at prices which wUl ensure to them the absence of loss if not the certainty of profit. The present situation fitly expresses the tough and impertui'bable spirit in which real estate in¬ terests bear up under prolonged depression. The fever of speculation has entirely departed, and the period of inertia and prostration—as the resulting reaction from high and intense feverish excitement—has already passed away, and these mterests may be said to be in a condition of hopeful convEdescence with more or less encour¬ aging symptoms which foreshadow steady, regu¬ lar and unchecked actiAdty, although by no means affording the foundation for any hopes of a speculative rise. The present status of the mar¬ ket is strictly normal, its movements being guided and controUed by purely natural conditions. Resources are being husbanded, improvements are calculated and gauged to the lowest possible cost, and there seems to be a real competition in the matter of best and cheapest production. The three prime conditions on which so largely depends the renewal of active prosperity in real estate are aU but reaUzed. Many hopeful, enthu¬ siastic persons would have us beUeve that they¬ are within a very short distance of complete ful¬ filment. The hope of promised realization, how¬ ever, has been so long deferred that we shaU not claim the accompUshmenfc untU the facts are present before us. Rapid transit is slowly grow¬ ing in physical construction and in its progress through the Courts. The legal victories so far won have all been in favor of the new system, and must tend ultimately to strengthen the legal basis of this projection of transit. The revival of business so impatiently and ardently hoped for, seems to be reaUy daAvning upon us, although there are many who protest that the pubUshed revival of mercantUe prosperity exists more in the newspapers and in the imagination of the writers than in reality and fact. The impatience of the American character is subjected to a very severe strain in a prolonged season of stagnation. The feeble pulsations of fresh business, such as are being manifested in trade circulars to-day, would amply satisfy a more conservative com¬ munity, and ought not to be despised in our OAvn. They may be fairly taken as the earnest or promise of better seasons ahead. As weU as we can understand the situation in general, Trade to-day consists of a large volume of business con¬ ducted at an almost imperceptible or very moderate profit. Out of such beginnings, how¬ ever, there wUl be developed the germ of a better and more lucrative business, especially when the unrestricted demand for goods arises from the four quarters of this recoustiiicted and reconcUed country. The real estate interest must watch the commercial movement with intense soUci- tude and self concern, as the best hopes of our commodity centre in the harvesting of profits by the merchants. No wide¬ spread, prolonged or sustained movement in the various departments of real estate, can be expected until the ijierchants have begun to i-eap ample profits. The final and critical question which concerns the present and future of real estate—^that of the resumption of specie payments—is stiU held in abeyance and falls short of complete realization. Through the operation of natural causes, the premium has faUen to a trifling and tantaUzing percentage, which would quickly disappear under the enactment of a single Avise measure on the part of Congress. Nothing- can stop the gi-avitation of the soUd interests of this country towards a specie basis, and real estate, more than any other, AviU haU the day when the paper doUar is vvbrth a gold doUar. A volume of polemic might be written on the sub¬ jects arising from the relations of real estate to an irredeemable paper currency. Much has already been written in bold letters upon the records of the Register's office in this city and county. As we are momentarily expecting to bid a final adieu to the sm'viving premium, we wiU waive any such discussion. The unsettled condition of this question, however, continues to exert a moderating, if not depressing influence upon real estate movements, and continues to check any widespread transactions. AVe are per¬ suaded that with the fuU estabUshment of specie payments—the other conditions of the markefc continuing to remain as at present—^there would be such an outcropping of sound and wholesome buUding schemes as woiUd far surpass any demon- sti-ation that this city has ever known. Under the practice estabUshed almosfc immova¬ bly in this city, the true conditions of the renfc market can be best ascertained in the spring of the year prior to the first of May. Any further developments, prior to the succeeding May day, are apt to be of a sporadic and accidental charac¬ ter, hardly furnishing any true index of the con¬ dition of affairs. We are credibly informed, and our OAvn observation has confirmed the accuracy of this data, that, in consequence of the accommo¬ dating disposition manifested by landlords during last spring, but few houses were carried over unoccupied during the summer. As a rule these have been prompter taken up by the returning tide of citizens this faU, but at rents no greater than those-obtained last spring. In the fashion¬ able quarter there is all but a scarcity of good, rentable properties, and this condition, no doubt, has had its influence in the sUght development of demand for houses to purchase that has been observable. It is hardly a matter of surprise that there should be this scarcity of rentable houses in the fashionable quarter, for the reason that, un- Uke other sections of the city, where the great estates OAvn blocks of houses that are held pur- jiosely for renting, in this quarter, Avith one or two exceptions, the rentable houses are held singly and in no great number. • As far as we can gather from the transactions in this choice section, the scale of rents is graded, with great discrimination, from $3,000 as a max¬ imum for the largest and best houses down to $3,000 as a minimum rate for the smaUest houses that can be found. Outside of the fashionable quarter the range of rents extends from about $1,500 to $800, the greatest scarcity known in this city being of houses that range from $800 to $1,200 in a good location. The seekers for such properties are compeUed to take refuge in the new apartment houses, of which there is such a