Columbia University Libraries Digital Collections: The Real Estate Record

Real estate record and builders' guide: v. 24, no. 611: November 29, 1879

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Real Estate Record AND BUILDERS' GUIDE. Vol. XXIY. NEW YOEK, SATURDAY, NOYEMBER 29, 1879. No. fill Publislied Weekly by Clje Seal Estate Eecorb S,ssociali:an. TERMS. ONE YEAU. in advance.. ..SIO.OO. Communications should be addressed to C. W. SWEET, Nos. 1:15 AND 1:^7 BrOADWAT NORMAL VALUE OP LAND. What should be the average price for an acre of land, used for purely agricultural purposes— that is, for the growing of the ordinary grain crops ? Tbis question has been put many times, and the answer has generally been that it was diflicult to give a figure in view of the great diversities brought about bj' the character of the soil, the distance from market, the nearness to i-ailroads and other incidental circumstances. But a large number of authorities agree that about fifty dollars per acre should not be ex¬ ceeded in the purchase of average good land w-ith average advantages. A piece of rich soil near a large city may be worth a thousand dollars an acre for growing garden truck. The same land in central New York, away from a ready market, would not be worth ninety dollare an acre. There is very rich land in the Western States which can be bought for from tbree dollars to tive dollars an acre, and some rather poor laud in the Eastern States which can be sold for a liundred dollars an acre, but the fact to be borne in mind is the rapid equalization of values which is taking place all over the country. It may be said broadly that during the past seven years farmers in the Middle and Eastern States have uot made, and may have lost some money, while it is very cer¬ tain that for the last two years,farmers in the Western States, particniarlj'- ia the e.xtreme West, have mado a great deal of money. The great speculator, Jay Gould, it is well-known, was for a long time a " bear " on Eastern stocks, that is, the securities of railroads east of the Mississippi River, while at the same time he was a violent " bull" upon all securities west of the Missouri Eiver. He argued, and rightly, as the event proved, that prices would advance at points to •which the tide of emigration centered, and would retrograde, or, at least, stand still, at points from ■whence the emigration was going. In other Avords, he believed that while Kansas, Nebraska, Colorado and Texas were being settled by emi¬ grants from the Eastern States; while mines were being opened and new farms taken, that in that quarter there would be an advance in prices, and the new railroads would add largely to their business, while in the railroads]of the States from which the emigrants came theie would be less doing. Mr. Jay Gould has a large following in Boston, and it is remarkable {that the first profits were made by the Eastern men rather than by New Yorkers in the new roads west of the Mis¬ souri. It was Boston capitalists who made the immense gains out of the Atchison, Topeka & Santa Fe road. The same capitalists also made the fii-st " big " money out of the Missouri, Kan¬ sas & Texas Railroad. The Kansas Pacific stocks had the "cream" taken out of them by Jay Gould's Eastern followers, and it is well-known that it was Boston which held the Union Pacific originally at very low prices, to sell out finally to New Yorkers at very high prices. This in¬ crease in the value of the Western roads is partly due to the opening of new mineral regions, but more especially, it is to be credited to the taking up of Western land, and the heavy crops of grain and wheat which the extreme Western railroads have been obliged to carrj'. This same process is now going on in the Northwestern regiou, and",Minnesota as well as Manitoba and the Red River Valley are destined to witness an immense emigration within the next few years. Land is stilljlow in that region, and there is a large margin for a rise. Let it be re¬ membered that the salient fact of the next five years is the enormous development of the Terri¬ tories west of the Missouri and northwest of the Mi.ssissippi. The new constitution of California, also by discriminating against the immense land holdings of the millionaires, will tend to sub-di¬ vide farms and there will be a great increase of inhabitants in California in consecjuence. We ex¬ pect to .see emigration not only from the East here, but from Europe, set in on a scale of unpar¬ alleled magnitude. The great West is like an ex¬ hausted receiver into which will rush the popula¬ tions from other parts of the globe. This will tend surely and certainly to the equalization in the values of land; in this respect following the railroads where this increase in the price of the minor railway securities has,'been so marked a feature of the recent Wall street "booms." But farming at theEiust can scarcely have been called profitablo for at least ten years. Colonel Richard Lathers, who owns five hundred acres of what is considered splendid farming land in the Berkshire District, Massachusetts, told the writer that he could make no money out of his domain, either by grazing or grain growing. He bought the land very cheap, consolidated nine farms and made what would be considered a splendid prop¬ erty iu Great Britain. He did not believe that any Eastern farmer had recently made money, because of the competition of the Western grain grower, and the cheap through rates on the rail¬ roads. Colonel Lathers added that were he to give his farm to an Eastern tenant, charging him uo rent the tenant could not make it pay on ac¬ count of the difference in the price of labor and of seed, and the difficulty in getting to market on account of the competition of the Western raiser and seller of grain. The Colonel is a man of great sagacity as well as wide experience, and he was satisfied that there had been an actual loss for the last few years on all farms in the Middle and Eastern States; that the great fertility of the Western lands and the low rates on the railroads had put the Eastern farmer at such a disadvan¬ tage that his land was not worth to-day what it had been selling for ten and fifteen yeare back. Land in the East is held, like in England, for other purposes than profit. It is because it involves an old homestead, or it is because the holders are well to-do, and do not care to sell on a falling market. It is expected, perhaps, that a new rail¬ way will come that way, giving value to the old propertj'; but certain it is that so long as the dis¬ crimination on the railroad is in favor of the extreme West just so long will farming be rela tively unprofitable iri the far East. All this Ls to be considered in the purchase of farming land. The same causes which have upset the landed a'ristocracj- of England, which bas made the growing of grain in Europe unprofitable, has been at work here in the Eastern States, and are likelj- to continue for some time until there is a rise in value of the Western property, or until some action is taken bj' the nation bj' which rail¬ roads will not be permitted to give an advantage to the Western forwarder over the Eastern pro¬ ducer. This will probably not be brought about by national legislation, as the next census will give so large a preponderance to tbe West and Northwest in the councils of the nation that everj'thing will be done to cheapen rates of agri¬ cultural protlucts in their way to the seaboard. Hence, for many j-ears we .do not look for any marked rise in farming lands in tho Eastern State.s, The West oilers such an inviting field that the Indian Territorj-, Texas, Nebraska, Colorado nnd the great Northwest, with its millions of fertile acres, will, for a long time to come, attract the Ea,stern farmers as well as European emigrantJi, because of the greater fertility as well as cheapness of the land. All these facts must be considered in estimating the average value of arable land. We very much doubt, taking the whole countrj- through, and estimating monej' as being worth si.x per cent., whether the average farm is worth more than $."jO an acre. We consider a higher price tban that for anj' of our Eastern farm lands as excessive, except, of course,^where there are large improve¬ ments, nearness to market, or otber exceptional advantages to be taken into consideration. Of course, special crops, such as grape growing, makes a verj- great difierence iu tbe price of land, and there is a great deal of land adapted for grazing [purposes which is worth more money than the average we have indicated. Still, one consideration must be kept constantly iu mind, viz., that the increase of tho population of the country is very great and is cumulative. The inhabitants of the United States are multiply¬ ing geometricallj-. This w-ill tend to raise the average price of land, East and West. The home markets for the Eastern farmer will also be in¬ creasing, owing to the denser population at the manufacturing centres, and last, but not bj- anj- means the least consideration is, the fact that the present "boom" in railway securities, which is making itself felt in the business world, will last of all be felt in all kinds of real estate. Property unsalable in '7.5, will be purchased with avidity at high figures in 18S1 and '82. Nay, more. It would not be surprising if this (ountry, at some time in the not distant future, should see an excited land speculation. The profits have been so large to those who have bought lands at cheap prices, that the time cannot be far away when the mania for purchasing will become very general, and we will seo the feverish land mad¬ ness of 1837 repeated. THE BOARD OF ASSESSORS. Our account of an interview with an ex-official in the preceding issue of The Real Est.^te Rec¬ ord, being entirelj' from memory, his language might possibly be construed as a reflection upon the present Board of Assessors—in that part, at least, where,reference is made to the delay in confirming the assessments. We take the first