“It would appear to be a bit paradoxical that the complete stalling of building operations should continue when it is generally known that the deposits of all our banks are growing by leaps and bounds, but let us examine this point a little. It is not probable that all people understand that the enormous part played by banking and business corporations in absorbing the four Liberty loans was not entirely accomplished by the use of available cash but that these corporate bodies mortgaged their income for, in many instances, a year in advance, and until their cash equilibrium has been re-established the builder will continue to be deprived of one of his principal necessities—mortgage money—at least in the quantity needed to finance his operations. This, however, is not his only difficulty. Material and labor conditions finish brilliantly with the lack of money in the race to devitalize our most potent economic factor—the home builder. We are all, undoubtedly, on the side of the argument which espouses union labor in its general, broad principles, but it is probable that our espousal is tempered with the belief that there is a sparking point between the dollar and the man beyond which neither may venture without completely stalling our productive machine. Just now the dollar will not buy all the man needs and he calls into action the faculties at his command in order to obtain an additional dollar. The said additional dollar not answering to his summons, he proceeds to make war upon the dollar which is already serving as faithfully as a dollar can in the circumstances. Often he will contrive to get his dollar by giving less of his labor for it. The result is the same. Meanwhile the necessities of life—food, clothing and other vitally important things—move further and further out of his reach. Truly the dollar and the man should become better allies.
“This is a little beside the subject, but we all want, in our heart of hearts, to create and develop an American trait—the ability to bring our warring elements into harmony and apply the result to our general good.
“Savings banks are in generally the same position toward the building situation that other leading institutions are, with this possible difference—the necessity of restricting the loan to 60 per cent of the value as determined by the trustees. At once the present cost of building as against the estimate of actual value from the standpoint of the lending institution come into conflict and the desire of the borrower cannot be met unless he is in a position to meet the difference in building values out of his own resources. By this it may be readily seen that even if the savings banks felt entirely free to enter the mortgage market to any great extent the costs of material and labor exercise a controlling influence. There is in prospect further Government financing which will necessitate large participation by the banks, and this, for the present, serves to make a proportionate amount of money unavailable for the financing of building operations even in the face of the constant desire to supply our natural allies, the builders, with the money to conduct their operations.
“It is satisfying to note the improved feeling among savings bankers and the increased optimism that the conditions so briefly discussed here may, and probably will, improve to a point where there will be relief and the resumption of the relations between banks and builders so mutually helpful in the past.”
* * *
From Festus J. Wade, president, Mercantile Trust Company, St. Louis, Mo.:
“Every reputable financial institution that usually loans money on real estate security is, in my judgment, perfectly willing to continue to make such loans when the security is adequate.
“We have never ceased to make loans on real estate since the war began. In fact, we have been unable to secure enough real estate loans to meet the requirements
of our business and we are today ready and willing to finance any legitimate real estate enterprise where the property is improved with substantial buildings of the character that can be utilized for the benefit of the industrial, commercial and manufacturing interests of the country.”
* * *
From Gerald R. Brown, comptroller, the Equitable Life Assurance Society of the United States, New York City:
“It seems to us that the financing of real estate operations of any size in the near future will have to be accomplished by serial bond issues underwritten by investment bankers and title and trust companies who have a large clientele seeking investments of this character.”
* * *
From Alex. P. W. Kinnan, president, Union Dime Savings Bank, New York City:
“There has been a large increase for the past three months in the deposits of savings institutions, and the banks are now loaning on bond and mortgage, and expect, after the placement of the next Liberty loan, to be in funds to take a large line of mortgage loans.
“Personally, I do not expect to see a large boom in building this Spring. While land can be bought upon favorable terms, the present price of building material and labor makes it almost impossible for a contemplating builder to figure out a successful termination of his venture, and unless the price of building material and labor arrive at a solution of the problem, I do not look for any real boom in building until the Spring of 1920.”
* * *
From Albert L. Scott, treasurer, Lockwood, Greene & Co., architects and builders, Boston, Mass.:
“While it is true that material prices are high and labor is also high, yet these features are not, we feel confident, going to weigh too greatly with the concern which requires new buildings and equipment in order to maintain its position in the market, or to enter new fields. The important thing for every manufacturing executive to consider is, What can I do with my building after I get it?’ and not What is going to be the first cost of the building ?’
“Our opinion is that material prices are going to soften materially and that labor will work for a lower wage due to the inevitable law of supply and demand. We are in favor of maintaining labor prices at the highest possible point, but not even labor can go counter to the laws which control prices.”
* * *
From D. Everett Waid, F. A. I. A., president of the State Board of Examiners and Registration of Architects, New York City:
“There appears to be plenty of building work to do and there will be a good volume of building, if not a boom, provided labor difficulties show some sign of an early solution. The problems of financing operations and even high prices are, I believe, minor ones in comparison with the importance of some stability in labor conditions. Owners will not willingly proceed so long as they fear a fluctuation in prices and a complete tie-up when a building is half constructed.”
* * *
From Robert Willison, architect, Denver, Col.:
“What is the outlook for building? The outlook in Colorado never looked better. Inquiries show that the sentiment of our people is to get busy and make up for
“This is a little beside the subject, but we all want, in our heart of hearts, to create and develop an American trait—the ability to bring our warring elements into harmony and apply the result to our general good.
“Savings banks are in generally the same position toward the building situation that other leading institutions are, with this possible difference—the necessity of restricting the loan to 60 per cent of the value as determined by the trustees. At once the present cost of building as against the estimate of actual value from the standpoint of the lending institution come into conflict and the desire of the borrower cannot be met unless he is in a position to meet the difference in building values out of his own resources. By this it may be readily seen that even if the savings banks felt entirely free to enter the mortgage market to any great extent the costs of material and labor exercise a controlling influence. There is in prospect further Government financing which will necessitate large participation by the banks, and this, for the present, serves to make a proportionate amount of money unavailable for the financing of building operations even in the face of the constant desire to supply our natural allies, the builders, with the money to conduct their operations.
“It is satisfying to note the improved feeling among savings bankers and the increased optimism that the conditions so briefly discussed here may, and probably will, improve to a point where there will be relief and the resumption of the relations between banks and builders so mutually helpful in the past.”
* * *
From Festus J. Wade, president, Mercantile Trust Company, St. Louis, Mo.:
“Every reputable financial institution that usually loans money on real estate security is, in my judgment, perfectly willing to continue to make such loans when the security is adequate.
“We have never ceased to make loans on real estate since the war began. In fact, we have been unable to secure enough real estate loans to meet the requirements
of our business and we are today ready and willing to finance any legitimate real estate enterprise where the property is improved with substantial buildings of the character that can be utilized for the benefit of the industrial, commercial and manufacturing interests of the country.”
* * *
From Gerald R. Brown, comptroller, the Equitable Life Assurance Society of the United States, New York City:
“It seems to us that the financing of real estate operations of any size in the near future will have to be accomplished by serial bond issues underwritten by investment bankers and title and trust companies who have a large clientele seeking investments of this character.”
* * *
From Alex. P. W. Kinnan, president, Union Dime Savings Bank, New York City:
“There has been a large increase for the past three months in the deposits of savings institutions, and the banks are now loaning on bond and mortgage, and expect, after the placement of the next Liberty loan, to be in funds to take a large line of mortgage loans.
“Personally, I do not expect to see a large boom in building this Spring. While land can be bought upon favorable terms, the present price of building material and labor makes it almost impossible for a contemplating builder to figure out a successful termination of his venture, and unless the price of building material and labor arrive at a solution of the problem, I do not look for any real boom in building until the Spring of 1920.”
* * *
From Albert L. Scott, treasurer, Lockwood, Greene & Co., architects and builders, Boston, Mass.:
“While it is true that material prices are high and labor is also high, yet these features are not, we feel confident, going to weigh too greatly with the concern which requires new buildings and equipment in order to maintain its position in the market, or to enter new fields. The important thing for every manufacturing executive to consider is, What can I do with my building after I get it?’ and not What is going to be the first cost of the building ?’
“Our opinion is that material prices are going to soften materially and that labor will work for a lower wage due to the inevitable law of supply and demand. We are in favor of maintaining labor prices at the highest possible point, but not even labor can go counter to the laws which control prices.”
* * *
From D. Everett Waid, F. A. I. A., president of the State Board of Examiners and Registration of Architects, New York City:
“There appears to be plenty of building work to do and there will be a good volume of building, if not a boom, provided labor difficulties show some sign of an early solution. The problems of financing operations and even high prices are, I believe, minor ones in comparison with the importance of some stability in labor conditions. Owners will not willingly proceed so long as they fear a fluctuation in prices and a complete tie-up when a building is half constructed.”
* * *
From Robert Willison, architect, Denver, Col.:
“What is the outlook for building? The outlook in Colorado never looked better. Inquiries show that the sentiment of our people is to get busy and make up for