Reflecting in part the large proportion of new homes built for owner occupancy during the past 15 years, Census estimates now show a reversal in the trend away from home ownership. Thus, in April 1947, nearly 55 percent of the 39,016,000 occupied homes in the United States were owner-occupied. This represents the highest proportion of owned homes for which published census data are available.

Privately financed permanent nonfarm dwelling units started, annually, 1935-49

Sources: Bureau of Labor Statistics, Federal Housing Administration, and Veterans' Administration (Jan. 30, 1950).

Mr. PATMAN. We know, generally, the number of people owning their homes in the city and the number of farmers owning their farms in the country have greatly increased the past 15 years due to the Government's encouragement.

Mr. FOLEY. The number has increased. My answer was related to the proportion which I think, also, has increased.

Mr. PATMAN. It occurs to me that such an increase in home ownership is a complete answer to any charge that might be made that the administration is going in the direction of socialism and communism. In a totalitarian state, whether it is Communist or Fascist, they certainly do not encourage home ownership, they encourage just the opposite by taking over the homes and the lands and the buildings and the businesses and things like that, but here in this country we are encouraging people by the use of the Government's credit, to own their own homes and their own farms which I think is the best answer to any totalitarian argument that might be made. I believe that a country, where the people own their own homes and their own farms has the greatest bulwark against these foreign isms that any country in the world can have. I think our country is going every day, as this bill here indicates, just in the opposite direction to a totalitarian form of government or socialism or communism.

Mr. FOLEY. I quite agree and I think the Congress, itself, has recently stated that exactly to be its objective when it passed the Housing Act of 1949 with its declaration of national housing policy.

Mr. PATMAN. Do you have that declaration of policy there with you?

Mr. FOLEY. I have a copy of the bill.

Mr. PATMAN. Of course, when the people pay for these housing projects, if they still belong to the State, that would be bad, but under the measures we are considering they would belong to the people. Even the public housing projects, when they are paid for, don't belong to the Federal Government, do they?

Mr. FOLEY. The public low-rent projects belong in all cases to the local agency, not the Federal Government.

Mr. PATMAN. The Federal Government never had title to them at all, so the direction, instead of the State acquiring land and buildings and trying to own everything, our Government is going in the opposite direction that of encouraging home ownership and farm ownership.

Mr. FOLEY. The only exception to that is Ohio, because of a peculiar situation in their law which I understand now has been corrected. Mr. TALLE. Will you yield to me at that point ?

Mr. PATMAN. Certainly.

Mr. TALLE. In any locality where there is no local agency and there is a Federal housing establishment, Mr. Foley-----

Mr. FOLEY. I am sorry, I didn't get the first of that.

Mr. TALLE. Take such a place as Long Beach, Calif., there is no local housing authority there but there is a Federal housing establishment. Shouldn't you revise your recent statement in a situation of that sort?

Mr. FOLEY. You are referring, in the public housing there, Congressman, to war housing or possibly veteran's reuse housing, built since the war. That is under an entirely different set-up and if you recall it was built under the Lanham Act and was not intended to be permanently held by the Federal Government but to be disposed of. It is one of the problems that we are laboring with, the disposition of that. We are making progress. There is before Congress legislative proposals which would simplify our task in that direction, but that is distinguished from the low-rent public housing to which Congressman Patman was referring and which is owned, when built, by local housing authorities. The act requires the procedure to be local in initiation and handling.

Mr. TALLE. I understand.

Mr. PATMAN. The Government does not have a policy that would cause the land to ever be owned by the Government but the policy is to make it possible and easy for the individual to own his own home or his own farm.

Mr. FOLEY. In connection with all of the home ownership provisions of the law, which are the predominant ones? When you deal with rental housing, of course, you are dealing with all of the insured mortgage operations and in this proposal with rental projects which would be privately owned but not owned by the Government.

Mr. PATMAN. The Government is not trying to acquire anything. Mr. FOLEY. It hopes never to acquire anything as a matter of fact. Mr. PATMAN. Do you have that declaration of policy?

Mr. FOLEY. Yes.

Mr. PATMAN. Suppose you read that? It sets forth the policy of the Government!

Mr. FOLEY. It takes a full page. I might read the first part of it and just call attention to the rest.

The Congress hereby declares that the general welfare and security of the Nation and the health and living standards of its people require housing production and related community development sufficient to remedy the serious housing shortage, the elimination of substandard, and other inadequate housing through the clearance of slums and blighted areas, and the realization as soon as feasible of the goal of a decent home and a suitable living environment for every American family, thus contributing to the development and redevelopment of communities and to the advancement of the growth, wealth, and security of the Nation. The Congress further declares that such production is necessary to enable the housing industry to make its full contribution toward an economy of maximum employment, production, and purchasing power. The policy to be followed in attaining the national housing objective hereby established shall be: (1) private enterprise shall be encouraged to serve as large a part of the total need as it can; (2) governmental assistance shall be utilized where feasible to enable private enterprise to serve more of the total need; (3) appropriate local public bodies shall be encouraged and assisted to undertake positive programs of encouraging and assisting the development of well-planned, integrated residential neighborhoods, the development and redevelopment of communities, and the production, at lower costs, of housing of sound standards of design, construction, livability, and size for adequate family life; (4) governmental assistance to eliminate substandard and other inadequate housing through the clearance of slums and blighted areas, to facilitate community development and redevelopment, and to provide adequate housing for urban and rural nonfarm families with incomes so low that they are not being decently housed in new or existing housing shall be extended to those localities which estimate their own needs and demonstrate that these needs are not being met through reliance solely upon private enterprise, and without such aid; and (5) governmental assistance for decent, safe, and sanitary farm dwellings and related facilities shall be extended where the farm owner demonstrates that he lacks sufficient resources to provide such housing on his own account and is unable to secure necessary credit for such housing. * *

Further detail is given, but I submit, Congressman, since the situation has arisen, that the bill before you is designed very definitely to further advance the achievement of the objective through the means that have been set forth here as the policy.

Mr. PATMAN. And that is through the private enterprise system insofar as it is possible and there is not anything in that declaration of policy that would indicate that the Government is trying to get hold of any land, or any farm, or any homes, but, on the other hand, is trying to make it just as easy as possible for people to buy and own their own homes and their own farms.

Mr. FOLEY. The very sequence of the items in the statement of policy by which the objective is to be achieved, I think, emphasizes what you said.

Mr. PATMAN. Yes, sir.

Mr. DEANE. I understand, Mr. Patman, you are going to ask Mr. Foley to submit for the record a statement of progress!

Mr. PATMAN. That is right.

I believe you are getting that statement now?

Mr. FOLEY. I think it would be better if I prepare it and put it in the record, if you don't mind.

Mr. DEANE. Incidentally will that statement include the over-all program including private builders?

Mr. FOLEY. What I understood Congressman Patman to want were statistics which would show the development of home ownership, numerically and relatively as against 15 years ago and now. If there is something further you would wish us to add to it, Congressman, would be glad to do so.

I

Mr. DEANE. It seems to me it should be a comprehensive statement.

Mr. FOLEY. Giving the actual break-down of the statistics, we can do so very readily.

(See pp. 34 and 35.)

Mr. HAYS. I believe you referred to the experience in New York State of the cooperative plan. Were there other communities in which you made a detailed study?

Mr. FOLEY. I don't know all of the factors that entered into the tabulation, since I couldn't sit in on all of the meetings, Congressman. The chief projects, from which it was possible to draw information relating particularly, for instance, to the costs of operation and to the necessary allowance for a vacancy reserve, were in New York. They involved the Amalgamated projects there.

Mr. HAYS. It is such a new idea to those who live in the mid-South, for example, that I want to ask a few elementary questions. It is relatively a new idea in America, isn't it, in the field of housing?

Mr. FOLEY. In the field of housing it is relatively new. It is not quite so new as this more recent, intensive discussion of it. Various publications on the subject go into a number of projects. The Department of Labor, I think, has issued two bulletins, one of them revised only last year, which gives the history of a considerable number of such projects, and we would be glad to furnish that for the use of the committee. There is other literature on the subject.

There have been a number of cooperative housing projects in this country. It is rather difficult to get a record of all of them. Also, as I indicated in my statement, Congressman, because of the difficulties in finance and the difficulties in getting technical advice and organization and so on, a very large number of those projects have been only in part cooperatives. They have been a cooperative, for instance, to obtain the land, or to get the houses built, or for various phases of development, and have not gone all through as cooperatives, such as are contemplated in this bill. Under the bill the projects remain fully on a cooperative basis. I will be glad, as I say, to furnish to the committee copies of such literature as we have on those subjects.

Mr. HAYS. When I was in Denmark 2 or 3 years ago, I observed that they had a number of successful cooperative apartment projects. Denmark inaugurated the cooperative idea in the field of rural work and farm ownership, but it seems they have also done significant work in housing. Have we duplicated that or come close to it anywhere in America that you know of?

Mr. FOLEY. I don't know that I could say we have duplicated it in the sense that you may have in mind, Congressman. Of course, the cooperative sale of apartment houses on a cooperative basis has been a much more active undertaking in several cities of this country recently, but I don't believe that is a paralleling of what you have in mind.

We have not had very much of that sort of thing. Amalgamated, again, I think, is the best time-tested case we have of large size.

Mr. HAYS. My attention was just called to a provision in the bill on page 2:

* ** * will encourage and assist (1) families of moderate income in acquiring (subject to the right of the cooperative to repurchase) ownership of their individual dwellings where such dwellings are free standing. *

That, of course, I gather, receives your approval and emphasis? Mr. FOLEY. I pointed out in my statement-and I am glad you have mentioned that particular language, Congressman, because in some places there may be some misunderstanding of what is meant by "ownership," as set forth there. It is not and could not be, if the cooperative is to be a true cooperative continuing until the mortgage debt is fully paid. The case of each cooperator having title in the usual sense, but he does have the ownership in the sense of continued occupancy and the right thereto, which is transferrable priority for first buying it existing in the cooperative association, itself. In other words, among the other things that a cooperator in such an organization as here envisioned would do, would be to surrender any right to speculative sale of his ownership but he does have ownership in the sense that I have outlined.

Mr. HAYS. Loans are not limited, though, to this type of a dwelling. You are going to build cooperatives that will build apartment houses. That is shown on page 2?

Mr. FOLEY. Oh, yes.

Mr. HAYS. Which will have the greatest significance? Will it be significant chiefly in multidwelling, or in the detached house? Which do you think would have greater significance?

Mr. FOLEY. It is very hard for me to have a judgment on that at this time, Congressman. I think it will vary under different conditions in different parts of the country. In the larger cities, where the desire may be to build on what would be more expensive land, it would probably be easier and a readier achievement to go to the multifamily type. In smaller communities, where it is possible to get lower-cost land, usually adapting itself to a more open type of housing, you will probably find a greater tendency toward the detached house. I doubt that there is any basis on which we could at this time have a judgment as to the ultimate outcome, as to the distribution between multistory or garden-type apartments and single-family-detached or twin-house construction.

Mr. GAMBLE. The greater percentage to date is in the multifamily, is it not, sir, under the cooperatives?

Mr. FOLEY. I don't have, Congressman, sufficient exact information on all of these many varieties and types of cooperative movement in housing. I would say that there is a rather wide distribution and without having the actual statistics before me I am still under the impression from the many projects I have read about that free-standing houses are quite characteristic of the operation today.

Mr. GAMBLE. I am thinking along the New York line, where most of the cooperatives are on a multifamily arrangement.

Mr. FOLEY. Yet in Pennsylvania there are some developments with the other characteristics, but not as great size.

to.

Mr. HAYS. I want this Department of Labor study that you referred

Mr. FOLEY. Yes; I will see it is furnished.

The CHAIRMAN. What is the average rate of interest on real-estate loans, generally?

Mr. FOLEY. I am sorry, Congressman; I didn't get your question. The CHAIRMAN. I say, what is the present average interest rate on real-estate loans?