The Future of Home Ownership

Report Outline
Signs of Revival in Residential Construction
The Potential Demand for New Houses
Cost of Buying and Maintaining a Home
Family Income Available for Rent or Purchase
Special Focus

Signs of Revival in Residential Construction

Increasing Activity in the Building Industry

Revival of residential construction is the most eagerly awaited sign of a new advance toward prosperity. During the recovery period from 1935 through the first half of 1937, while many industries approached or surpassed their 1929 levels, activity in the building trades remained far below the peaks which had been reached 10 years before.

Although the value of new residential buildings for the first six months of 1938 was 11 per cent less than for the corresponding period in 1937, the percentage of decline decreased from 51.4 per cent in February to 5.9 per cent in June, and early reports for July are encouraging. Figures from the Federal Housing Administration furnish a special basis for optimism. Mortgages insured by the F. H. A. in June had a total value 20 per cent above the amount for May, and 61 per cent above June, 1937. Mortgage insurance applications during the first four weeks of July were 100 per cent more than for the corresponding weeks in 1937. However, most of this increase is the result of liberalization of the Federal Housing Act last February, and only the very latest figures indicate a possibility that residential construction in 1938 may actually exceed the 1937 total.

During the first three months of 1938, more dwelling units were constructed in two-family and multi-family buildings than in single houses, but since that time individual dwelling construction has regained its normal lead. F. W. Dodge reports show that the number of homes built for owner-occupancy in the first six months of 1938 was greater than for any comparable period in several years. The outlook for increased home ownership is definitely improving so far as the immediate future is concerned. The long-term trend involves many factors which are less easy to evaluate.