Senator SPARKMAN. Ten square feet per unit?
Mr. FINE. I am sorry, 10 square feet per unit.
Senator SPARKMAN. That is different.

Mr. FINE. We have found we are able to enter into a constructive relationship with the United Fund agency in our community, the Senior Citizen Division, which has 154 organizations actively engaged on a day-to-day basis in studying and meeting the needs of our elderly citizens. These folks will be able to maintain the day centers with no cost to the Federal Government.

3. We would remove the restriction that no public-housing project may be provided unless the city has a workable program in effect, insofar as the projects for the elderly are concerned. In others, that has been necessary, but I think, in these projects, it is not particularly necessary.

4. We would provide funds for local authorities to hire a social worker for such projects, or could contract for such services within an existing casework agency to help these folks with the many problems they have, the least of which is the knowledge of how to avail themselves of the many benefits that are available to them.

5. We would remove the requirement that only 10 percent of the units under any one annual contribution contract may be designed for the elderly. It may very well be that we should allow that to be determined by the local authority.

6. We would recommend allowance for special design features for elderly projects and particularly allow waivers of certain requirements for other projects. For example, it would appear obvious to us we may not need as many parking spaces in a project designed for the elderly as we would in regular project, and that should be waived. 7. I think one of the most important administrative directions, is that at the very inception of these projects, they should be planned and coordinated with the local welfare planning agencies who have a tremendous amount of knowledge and know-how in these things and who can coordinate their efforts with those of the local authority and, thereby, multiply the good that can be done in these particular instances.

8. Study should be given to the question of whether or not an increased Federal subsidy may be required in connection with some of these projects. I was happy to hear Senator Clark say he has a bill now pending before the Senate in connection with just that problem.

9. Lastly, and we think one of our most important recommendations, is that grants be authorized by the Housing and Home Finance Agency similar to those under section 314 of the Urban Renewal Act, which would allow the public-housing authority locally to make certain tests and do certain basic research in connection with the best methods, manner, and means of developing such programs. Particularly, as to how to develop them in complete cooperation with local, existing agencies, who do a lot of good legwork in connection with these projects.

Senator SPARKMAN. Thank you, Mr. Fine. You have given us a very fine statement, and we appreciate it.

(The charts referred to follow :)

Includes interim premiums amounting to 2,368.92 & 15yr. payments to $1,854.6

Senator SPARKMAN. Mr. O. H. Brinkman, executive secretary, legislative committee, National Apartment Owners Association.

STATEMENT OF 0. H. BRINKMAN, EXECUTIVE SECRETARY, LEGISLATIVE COMMITTEE, NATIONAL APARTMENT OWNERS ASSOCIATION, INC.

Mr. BRINKMAN. Mr. Chairman, the chairman of our legislative committee, Mr. Henry duLaurence, of Cleveland, had intended to be here. He is a lawyer in Cleveland and, unfortunately, he had to be in court yesterday. He was unable to be here today and has asked me to appear to present his statement with your permission, if I may.

Senator SPARKMAN. Very good, sir.

Mr. BRINKMAN (for Mr. duLaurence). Our association is a national organization of rental-property owners whose membership extends through 37 States of the Nation. We appreciate being given the opportunity of appearing before this committee to give our views on housing.

Our appearance before this committee to discusss national housing must of necessity be general in scope, because we are, in fact, speaking on 17 or more bills involving housing which vary factually and in scope as to the recommended legislation for housing. Rental housing and private housing can and must be considered together, for whatever affects one will in equal proportion affect the other. We think that any legislation affecting housing must be weighed carefully, for collectively it represents not only our greatest national dollar asset, but individually is usually the greatest dollar asset of every homeowner in the country.

We would like to pursue the subject of certain unusual characteristics of housing which makes its use difficult to control and its value easy to upset. I would like to enumerate some of these.

1. Dollarwise, housing generally represents the biggest expenditure for the use of the family whether such housing is rented or owned. Tinkering with housing thus can develop far greater losses than in any other industry in the Nation.

2. Housing is immovable. Once constructed it has to stay in place until it is destroyed. This means that if unwise legislation creates a surplus, it cannot be stockpiled or it cannot be stored as in the case of farm surpluses.

3. Family use of housing is generally limited to one family per house. Any surplus of housing will make itself felt in loss of value or loss or reduction in rent. In the case of most other property you can encourage the use of additional items by reducing its price or increasing the scope of its use-but no matter how much you reduce the price or make more attractive the rent involved, a family can use one and only one house. A surplus is more dangerous in housing than in any other industry or commodity.

4. Proper maintenance of value or rents is a direct requirement for the prevention of slums-any deterioration, either of value or rents, will contribute to the deterioration of property, with ultimate slums resulting. Slums are merely the neighborhoods where housing has deteriorated to such an extent that it is in need of major repairs and is

far below the standards of the community where it is located. There is an equation of value to deterioration. When value deteriorates there is less incentive to maintain property-when rents are reduced there is less money to maintain the property. It is our contention that our slum problem has reached such extensive proportions because of former rent control which was continued long after the war and long after there was need for it. Those of this committee who sat here during the rent-control days will remember that this association consistently predicted that slums and substandard housing would be the direct result of the needless continuation of rent control. Our predictions have come true. We now make another prediction that if a surplus of housing is forced upon an already saturated housing market, it will create slums far faster than our urban-renewal programs can cure them or Federal moneys clear them. The present Housing Act already seems to create ample housing at a rate faster than our family formation. If this rate is accelerated, it will create housing surpluses which will depress prices and rents, which in turn will create more slums.

What is the situation in our national housing? What has been the ratio of housing construction to family formation? This is a most important consideration in determining a possible surplus of housing because we know that a family cannot use more than one house as a permanent domicile.

In the last 10 years we have built over 10,900,000 housing units but we have formed only 4,900,000 additional families. Thus, we have been constructing 121 percent faster than we have formed families. In 1950 our vacancy ratio was 2.6 percent. At the present time, it is 7.2 percent. This has been an increase of 275 percent. These statistics indicate that even at the present rate of construction we are actually building more housing than can be economically justified. It further indicates that if continued on the same basis for another 5 years, we shall increase our vacancy rate to 9.6 percent. We submit that the present vacancy rate is at an alltime high for the past 20 years. The last time this vacancy rate existed housing was barely emerging from the great depression of the 1930's. Any increase in this vacancy ratio would have serious repercussions on both housing values and rents.

What is the dollars and cents situation of rental housing? A realistic appraisal of the BLS index indicates little or no practical increase in the rental index in the last 5 years. It is true that the rent index has increased, but this increase has been primarily due to an insertion in the rent index of rental housing, usually constructed for the top of the rent scale and also due to an elimination of some slum housing usually at the bottom of the rent scale. The great body of rents therefore have increased little or not at all in this period of time. At the same time wages and buildings costs have continued to rise faster than the rent index-which, if continued, will price rental property out of the maintenance market. This will have a harmful effect on future housing and will result in deterioration of existing properties.

We believe that any substantial modifications of our present Housing Act will create problems out of all proportion to the good which may be done. We are firmly convinced that with the easy credit and small downpayment on housing required in this market, any respon