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Real estate record and builders' guide: v. 24, no. 592: July 19, 1879

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Real Estate Record AND BUILDERS' GUIDE. Vol. XXIV. NEW YOKE, SATURDAY, .3 ULY 19, 1879. No. 592. Published Weekly by TERMS. ONE 'VEAU. in advance....$10.00. Comniimications should be addressed to C. IV. SAVEET, Nos. 345 AND 347 Broadway CHARACTERISTICS OF THE NEW SPEC¬ ULATION. Real estate men and citizens generally are dailj- becoming impressed %vith the fact that we are now in the midst of a notable and genuine leal estate speculation. What was contemptuously spoken of in the beginning of the year as a spurt, by the lapse of time has proved to be a prolonged and woU-sustained movement, slowly ramifying fiom the centre to the extremities of the real es¬ tate market. This movement took its start, and will undoubtedly find its climax, in the best resi¬ dence part of the city. We shall watch its career and await its culmination with anxious interest and shall endeavor to keep our readers informed of its vicissitudes or eventualities. At present we propose to speak of some of its more noticeable characteristics, and prominent among them are: 1st. Its Inverted Order.—In all past seasons of real estate speculation the movement followed or ran parallel with a brisk demand for private residences, being greatly stimulated by a prospec¬ tive scarcity of dwelling accommodations and taking wholesome root in a well-assured success of the building craft. In the presenfe instance the lot market seeni.s to have started off on its own hook, very much as if the leaders had broken loose and were galloping away from the wheel horses. To be sure, in the old residence and build¬ ing (piarters all newly tinished houses were promptly absorbed during the spring, but at prices which yielded no immoderate profit to the build¬ ers, and which, in fact, bai-ely afforded them en¬ couragement to embark in new enterprises. The stock of such houses amounted to less than an or¬ dinary season's supply and buyers evenly tied the number of houses, leaving no nnsatisfied demand. In the new residence iiuarter equal luck has failed to attend active builders. Although they reaped the benefit of some little overflow of demand, their large stock of finished houses has undergone only a slight reduction, and some of the most meritorious jobs are to-day standing finished and unsold. The sales that have been made in this 'luarter were at figures only a trifle in excess of the prices now asked for neighboring vacant lots. We say, therefore, that a peculiarity of this spec¬ ulation is that lots have taken a marked precedence over houses, and that the movement is more of an independent, lot speculation than one predicated upon success in the building line. Instructive infer¬ ences may be drawn from this statement on -which it will behoove operators to ponder. For the pres¬ ent it is sufficient to record the fact, without fur¬ ther comment, that lots in both of the growing residence quarters are exceedingly active, while finished buildings are only moderately so and have totally failed to keep pace with the move¬ ment in lots. Whether time will adjust and erjual- ize respective values remains lo be seen. If it does not, we can imagine with what despair build¬ ers will contemplato the new scale of lot values. 2d. Irs DEFi.virn-EXESs.—The ])aradox just re¬ ferred to may be explained by the further fact that the present movement has its origin aud sup¬ port principally, if not entirel3^ in a formal ex¬ pression of Ane-.vs by leading and influential citi¬ zens, in raspect to future residence sites. The scope of the movement is no less than the defini¬ tion of a new fashionable residence quarter, whereas a short while ago it seemed as though a decade or two might elapse before the old resi¬ dence quarter would be fully exhausted and com¬ pleted, and the controversy was then an active one ns to whether the East or West Side would be tho immediate successor of the central quarter: it is now determined by the movement of this spring, promptly and irrevocably, that the district lying on the east side of the park, particularly that nar- now belt between Madison and Fifth avenues, will be tbe elite quarter of the immediate future. This characteristic amounts to a good deal more than the mere naming of a district. It signalizes and defines the limits within which marvel¬ ous prodigies of lot values may be expected that have heretofore outstripped and defied analogy, and given an exceptional celebritj- to choice New York real estate. Our crop of millionaires may nob be a large or rapidly growing one, but it is large enough and seems to possess vigor enough to dominate tho district which we have indicated, to confer upon it inevitable and enviable distinc¬ tion, and to infuse into it elements of value which may be dreamed of but scarcely enumerated. 3d. Its Substantial B^vsis.—The chronic bear and the wordy commentator on passing events are equally ready to declare that the present movement in real estate is too spasmodic, too energetic, and has already run too wild a course of inflation to be sound or permanent. These allegations may be easily sustained and the in¬ ferences to be drawn from them may seem plausible enough. It must bo remembered, how¬ ever, that this movement begins after nearly six j'ears, we might say seven years, of almost un¬ broken depression and stagnation in real estate. That its course should at first betray strongly re¬ actionary impulses, is not surprising. In their eager rivah*y aud competition for choice sites, wealthy citizens may have over-stepped the bounds of common prudence, but the lapse of time will serve to moderate their zeal as it cer¬ tainly will have the effect to equalize any re¬ markable disparities of value. The single de¬ plorable feature of the new movement is, that it will speedily create in the new quarter a condi¬ tion which has often existed, and which to-day exists in a marked degree in the old quarter. The values of vacant land threaten to become prohibitive of any other use than its purchase and special improvement by citizens of great wealth. If land owners in the new quarter de¬ sire this consummation they have it in their power to bring it about at an early day. Al¬ ready the quoted values are beyond the reach of prudent and solvent builders intending to- build for the market. The staff of honest speculative builders will not only be excluded from the two quarters, but will be completelj- dispei-sed and driven into other occupations i'" land prices con- tinuo to be held in disproportion to the share assii>leted building productions. Tbo substantial bn.=;is of the present movement is amply demonstrated by the uuipiestionable and undoubted soundness and respectability of its leaders and pioneers. To as;.sume that the recent stilting of values is tho result of a wild escapade ou the part of impecunious speculators would bo to hit wide of the mark. A movement which has been initiated and sustained by such eminent and conservative citizens a.i Arnold »t Constable. William H. DeForrest, W. A. Thomp.son, A. IT. Barney, and others, in the of lots, ami by Messr.s. Henry Havec.eyer, David Dows,Isbam, Bishop, Qiiintard, E-ichard Arnold, and others, in the selection of residence sites, and projection of private mansions, need not be deemed lacking in substantial character. These gentlemen exer- financial and social influence in their respec¬ tive spheres which wiU confer upon their exam¬ ples effective potentialitj'. Aside from the quality of the names %vhich appear in recorded transac¬ tions, convincing evidence of the strength of the movement is alVorded in the remarkable extent to which the use of mortgages is e-chewed. -In isolated cases large mortgages have been given, but the wealth of the parties is so tangible and assured that the mortgages may be regarded as mere temporary accommodations. The bulk of transactions also indicates the momentum of the speculation. A dozen corners on iladison avenue have cbangeil hands, and one whole block, several half blocks, and innnmerable parcels of interior lots, raugiug from four to ten. The vigor of the upward tendency may be illustrated b3- a single citation. On Sevent3-- sixth street, between Fifth and Madison avenues, six lots were sold early in the year at $30,000, resold at i:()0,O00, and later on disposed of. with a building loan, at ?!00,000. Finally, the specu¬ lation is organized upon what is practically a gold basis. A movement so ausuiciouslj' begun cannot fail to reflect and irradiate a wholesome influence over the entire body of metropolitan real estate. It is warrantable to declare that tbe decline iu our commodity has been completely checked and overcome, and that the upward inarch has begun, rarapantl}'iu the best (piarter, and inuipie^tly in all other quarters, of the city. THE VANDERBILT BOGY, It is worth considering whether the outcry which has been raised over the report of the Rapid Transit Commissioners is deserved. As yet the public has not been put in po3ses.siun of the plans of the Commissioners in their entirety. In other words, while the routes have been laid out, the conditions as to fares and time are not yet known officially. It might as well be under¬ stood, firstasatlast, that there is a very powerful interest opposed to rapid transit on the other side of the Harlem River, unless it can be made use of for the benefit of tbe existing elevated roads. What seems to have excited the most wrath is the proposition to run an elevated road from the