HIGHER INTEREST

Evening Post, Volume CXXVII, Issue 117, 20 May 1939, Page 11

HIGHER INTEREST

EFFECT OF STATE LOAN

HOUSE PROPERTIES

The belief that one effect of the ne:w Government loan will be to still further restrict dealings in house property already hampered by. the Fair Rents Act, was expressed by Wellington land and estate agents whose opinions were sought today. One agent said that the new interest rate estabr lished by the loan would absorb investors' money that would otherwise be available for . house mortgage. Lawyers and other sections of: the commercial community, however, state that the new interest rate must generally harden the money market and be an inducement to investors provided they can find borrowers.

"The operation of the Fair Rents Act is becoming increasingly unfair as time goes on," said one agent. "While costs of repairs and other forms of maintenance, particularly painting, are showing a steadiy tendency to rise rents remain fixed by legislation and the return available to owners of rented properties under present conditions is far from attractive.

"It is also true that tlie type of landlord aimed at by the Fair Rents Act, generally speaking, "escaped its provisions because he saw some restriction • coming and got in early t"o dispossess tenants before the protection became operative. Many of- the owners whose rights are now prejudiced are those who voluntarily assisted their tenants during the depression period by reducing rents below an economical level, but they are now placed in a position where it is virtually impossible for them to dispose of their properties at a fair price or to obtain a rental that wll return them a reasonable percentage."