Makers of Fortune by R. C. J. Stone

Author:R. C. J. Stone [Stone, R. C. J.]
Language: eng
Format: epub
Tags: History, Australia & New Zealand
ISBN: 9781775581161
Google: dL8YAgAAQBAJ
Publisher: Auckland University Press
Published: 2013-11-01T04:11:51+00:00

THE REAL ESTATE SLUMP AND THE PLIGHT OF THE SPECULATORS The collapse of the suburban land market took place in the middle of 1885, while that in urban properties came just before the end of the year. In both cases the collapse was complete. In 1886 there was almost a paralysis in real-property transactions. At a meeting of the Auckland branch of the New Zealand Industrial Association in December 1886 a speaker estimated that there were 2,000 empty houses in the city.56 The position got much worse for houses and commercial structures alike. Here was no simple abatement of demand because of a cyclical recession. On the contrary, as people soon came to appreciate, the property boom had so stimulated commercial and residential construction that Auckland had overbuilt its requirements for years to come.57 Industries producing building materials languished. Building operations had ceased almost entirely by 1888, and there was no demand whatever for building sites. Auction sales were sparsely attended and few indeed would have taken place at all had not auctioneers been acting under instructions for mortgagees exercising their power of sale over the landed securities of defaulters. Early in 1888 J. C. Firth declared before the Rating Assessment Court in the city that there had been no property sold in Queen Street for months; and that offices formerly rented for £400 a year were standing tenantless.58 Another property owner said that Auckland landlords had developed into ‘a sort of Charitable Aid Society’, letting their properties almost rent-free. The City Council was forced to follow the lead of private landlords and be charitable too. It was obliged to reduce annual sums which lessees had covenanted to pay for endowment land in more prosperous times or see them bankrupted. Rents became ridiculously low. Workers’ cottages were leased for five shillings a week or less.59 Shops in the city or Newmarket had a rental as low as ten shillings.

Suburban and rural prices fell even further than those of city properties.60 In 1888 bidding for the 100 acres of Pine Island (Herald Island), nine miles up the harbour from the Queen Street wharf, did not reach the reserve of £500. The top bid for Sir Frederick Whitaker’s country residence at Lake Takapuna standing on 23 acres of land was £1,250. There had been little market for rural land since 1883, but after 1886 it was utterly at a discount. The highest bid for 28 Port Albert allotments at an auction in 1888 was Is Id each.

Landlords who in the early 1880s had been able to live well on the rents of properties had to adjust to a new standard of living. The expatriate James Farmer reflected unhappily in 1892 that his income as a landlord of Auckland city property had dropped by £1,000 within 10 years.61 Farmer’s agent, Campbell, did not himself depend on rents. But he too knew the dead weight that city property yielding low rentals and mortgaged up to the hilt could be. He was aware, too, of

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.