STATEMENT OF EDWARD P. DOYLE, ESQ., OF THE REAL ESTATE BOARD, NEW YORK CITY

Mr. DOYLE. Mr. Chairman and gentlemen of the committee, all I want to do is tell briefly our experience in New York and show you that what you propose here really would not benefit the tenant, but might do a great deal of injury to real property interests.

the only reason why I came here.

The CHAIRMAN. That is a very broad question.

That is

Mr. DOYLE. I mean by the bill. We had a housing shortage in the State of New York and mainly in the city of New York in 1920. The real estate board of New York, directed me to write to the mayor suggesting the appointment of a housing committee made up of representatives of the real estate interests and loaning companies and labor. That committee was appointed and I was made secretary of it. It was called the mayor's housing committee. The legislature in the spring passed the first remedial legislation, and with the approval of the real estate board it was merely the extending of the power of the municipal court judges to grant stays, giving them the power to stay eviction so there would not be any hardships in evicting a tenant. Unfortunately there was a provision in the legislation which provided that if on October 1 a landlord failed to notify the tenant that he wanted possession of the premises or wanted to increase the rent, the tenant went over for another year at the same

rent.

Just before October 1 of that year a great many landlords felt that it was necessary, in order to protect themselves, not that they had any desire to evict the tenants, to notify the tenants that they would require possession on October 1. That created the so-called emergency under which Governor Smith called the legislature in session and the court of appeals sustained the rent laws and the United States Supreme Court sustained them. That was the so-called threatened eviction of 100,000 tenants on the 1st of October. Then the rent laws were passed against the opposition of the real estate interests. The real estate board opposed them, but we succeeded in having them amended so they did not apply to new buildings, otherwise building construction would have stopped in New York City and in the State. If you will remember, we had them amended so they did not apply to new construction, and we also succeeded in getting a bill exempting new buildings from taxation, although the real estate board opposed that in principle, but they consented to it in order to help building.

Since that time we have not opposed the extension of the rent law, while the so-called emergency existed, although we denied the existence of the emergency and we tested out the laws, going to the United States Supreme Court. Our rent laws will expire in February, 1926. Last year we did not oppose their being extended to 1926, although opposed to them in principle.

The main result of the rent law in New York State was the building of an enormous number of one and two family houses. Sixty-five thousand I think were built in the several boroughs of Greater New York. The shortage, as far as the middle class or high-priced apartments, has passed, but it did succeed in effecting a tremendous change in ownership which I think has been very detrimental to the tenant.

For instance, I have been a landlord since 1884. Immediately after the passage of the rent laws I sold all my real estate-that is, all the real estate I had which was not business property. My example was followed, to a very large extent, by the old-fashioned investors in real estate. I invested in real estate believing it to be the very best kind of investment and so had the experience of being a landlord. I took care of my tenants and kept my houses in repair and even did not raise my rent during the war when everybody else raised their rent, although I was justified because during the trouble with the shipbuilding before the war I had 68 apartments vacant for three years and would have been justified in trying to get increased rent in order to get my money back that was lost during that time.

But the tendency of legislation is to drive out the old-fashioned landlord, the old-country man. The old-country men who came from where they could not own real estate were very proud to own real estate in this country. We had the German Jew and the English Jew and the Scotchman and the Irishman, and they were all property owners. Their places have been taken by the Rumanian Jews or the Russian Jews who are traders and by men who are traders generally of all nationalities and who are not investors and landlords and who have no love for the tenants as we have.

Our relations with the tenants were always of the best. We find that with this kind of legislation the tenants are just as dissatisfied as they ever were. We have had four years of rent legislation, and the tenants had a larger lobby at Albany the last time than ever before. It has not been a real benefit to them, but has been a detriment to them in that it has changed the character of the landlord.

Of course we are opposed to your bill as a matter of principle, and we came here to voice our sentiment. We had no real right to come, it being a matter affecting the District of Columbia; but we feel that you would be establishing a bad precedent to go into any kind of rent-fixing proposition, as you would in any other proposition affecting price fixing, food-price fixing, clothing-price fixing, or any other measure of price fixing.

Mr. BRANDENBURG. What was the statement you made about encouraging building in relation to the payment of taxes?

Mr. DOYLE. There would have been no building but for the passage of the law exempting new buildings from the operation of the rent laws.

Mr. BRANDENBURG. In other words, you exempted them from taxation?

Mr. DOYLE. Yes; and we also exempted them from taxation. Mr. BRANDENBURG. In other words, you encouraged building in that way?

Mr. DOYLE. Yes.

The CHAIRMAN. It is necessary for the committee to adjourn at this time. We are to have no further hearings until next Monday and will therefore stand adjourned until 10 o'clock next Monday morning.

(Thereupon, at 12 o'clock meridian, the joint subcommittee adjourned until Monday, January 19, 1925, at 10 o'clock a. m.)

RENT COMMISSION IN THE DISTRICT OF COLUMBIA

MONDAY, JANUARY 19, 1925

CONGRESS OF THE UNITED STATES,

JOINT COMMITTEE OF THE COMMITTEE ON THE DISTRICT OF COLUMBIA, Washington, D. C. The joint committee met, pursuant to call, at 10 o'clock a. m., in the room of the Committee on the District of Columbia, Capitol, Senator L. Leisler Ball (presiding).

Present: Senators Ball (chairman), Jones of Washington, and Copeland.

Present also: Representatives Lampert, Hammer, Stalker, and Blanton.

Present also: John A. Petty, executive secretary, and Rodger J. Whiteford, counsel for the Washington Real Estate Board; Thomas P. Gore, counsel for the Washington Association of Building Owners and Managers; Gen. Nathan W. MacChesney, general counsel of the National Association of Real Estate Boards, of Chicago.

The CHAIRMAN. Gentlemen, the committee will come to order. Whom shall we hear first this morning?

Mr. WHITEFORD. Mr. Chairman and gentlemen of the committee, I am here as counsel for the Washington Real Estate Board. Mr. Brandenburg, due to my inabulity to be here last Wednesday, was good enough to appear in behalf of the board. I am here this morning representing the board, which is one of the opponents of the legislation and I have some witnesses here. First I wish to have you hear from Mr. John A. Petty, executive secretary of the board, who will give the committee the benefit of the survey that has been made by the board with reference to housing conditions and will state to the committee the attitude of the Washington Real Estate Board toward the pending legislation. He was on the stand on last Wednesday but due to the number of questions that arose he did not get that part of his testimony in the record. He is prepared this morning to present a concise statement to the committee and I have no doubt will be glad to answer any questions the committee may desire to ask.

The CHAIRMAN. Very well; we will hear from Mr. Petty.

TESTIMONY OF JOHN A. PETTY, EXECUTIVE SECRETARY WASHINGTON REAL ESTATE BOARD-Resumed

Mr. PETTY. Mr. Chairman, I would appreciate it if possible that members of the committee permit me to complete my statement without interruption. I think it will save time and I shall then be glad to answer any questions the committee may desire to put to me. The CHAIRMAN. Very well; we will ask no questions until you shall have completed your statement.

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Mr. PETTY. I am authorized by the executive committee of the Washington Real Estate Board to make the following statement to the joint congressional committee now considering the proposed permanent rent control legislation for the District of Columbia. This organization represents 119 real estate offices in the city of Washington and has a vital interest in all legislation affecting real estate in the District of Columbia.

We therefore desire to fully and frankly discuss this subject with the twofold purpose of presenting to this committee our views on the proposed legislation backed by our practical experience and knowledge of the situation, and to express our desire to cooperate in the solution of such problems in respect to real estate practices as may seem to Congress to be present in Washington.

Heretofore we, as an organization, have not actively opposed rental legislation for the District. However, we now feel that-there is no necessity for its continuance and that a continuance of this form of artificial control is detrimental to the interests of both landlords and tenants, creates through its interference with property rights and private contracts a dangerous precedent in legislation nationally, prevents the normal function of economic laws, and seriously interferes with the continued growth and development of the city.

We do not stand alone in our opposition to this legislation, as is evidenced by the action of various trade and business organizations in the District of Columbia, which have formally noted their opposition. I refer particularly to the board of trade, District Bankers Association, Merchants and Manufacturers Association, and the Bar Association. The national aspect of the pending bill proposed for the Capital City has resulted in formal protest being noted by real estate organizations in all parts of the country, including national as well as local and State groups, trade and other associations, financial institutions, investors, property owners, and business men. From the facts to be presented we expect not only to justify our statement that there is no necessity for this legislation, but also to show that the proposed bill will actually prevent the accomplishment of the very purposes which it was designed to accomplish.

One of the primary phases of the subject of housing is the number of housing units available for occupancy. A survey which has just been completed by the Washington Real Estate Board covers residential properties, vacant and available for rental purposes through the rental offices of the 85 members reporting. Every member was advised to list no property in the survey which might reasonably be considered uninhabitable. Reports furnished are all in good form, the tabulations were made with utmost care, and duplications were eliminated. A complete statement showing the location, size, and rental of each property, as well as the name of the agent, is herewith furnished the committee as evidence of the existence of a plentiful supply of housing units available for rental purposes. All of the reports included in this statement were received within the past 10 days and therefore the list can be considered up to date.

This survey does not include properties handled direct by owners, resident managers, nor those real estate offices not affiliated with the board. However, this list is a concrete illustration of the existing vacancies throughout the city.

An analysis of our survey reveals the following properties available: Unfurnished heated apartments, 969; unfurnished apartments not heated, 69; unfurnished houses, 524; making a total of unfurnished properties of 1,562.

Furnished apartments, 54; furnished houses, 108; or a total of furnished properties of 162.

There

Rentals of the unfurnished range as follows: Up to $35 per month, 64; from $36 to $50 per month, 246; from $51 to $75 per month, 486; from $76 to $100 per month, 160; from $101 to $125 per month, 62; from $126 to $150 per month, 6; over $150 per month, 14. were a total of 310 listed at $50 or less, and 486 listed at from $51 to $75; or a total of 796 listed for $75 or less, and 242 listed at over $75. Rentals of the above-mentioned unfurnished houses range as follows: Up to $35 per month, 38; from $36 to $50 per month, 64; from $51 to $75 per month, 145; from $76 to $100 per month, 135; from $101 to $125 per month, 56; from $126 to $150 per month, 36: over $150 per month, 66. This comprises a total of 248 houses at $75 or less, and 293 at over $75.

The sizes of the unfurnished apartments listed range as follows: 1 room and bath, 30; 2 rooms and bath, 155; 3 rooms and bath, 433; 4 rooms and bath, 230; 5 rooms and bath, 131; 6 rooms and bath, 44; over 6 rooms and bath, 55.

The sizes of the unfurnished houses listed range as follows: 4 rooms and bath, 19; 5 rooms and bath, 27; 6 rooms and bath, 164; 7 rooms and bath, 64; 8 rooms and bath, 71; 9 rooms and bath, 68; 10 rooms and bath, 43; over 10 rooms, 68.

The apartments and houses reported are located in the four sections of the city as follows: Northwest, 1,501; northeast, 99; southwest, 35; southeast, 89.

In addition to the above, the following apartments under construction were also reported: Available February 15, 115; available March 1, 384; available April 1, 134; available May 1, 119; date of completion not given, 16. This shows a total of 768 additional apartments coming on the market approximately within 90 days.

About the middle of October, 1924, we made a study of rental conditions through the medium of a questionnaire sent to our membership. One of the principal purposes of that study was to determine the situation in respect to evictions and increases in rent. The reports when tabulated showed 1,154 voluntary reductions in rent, as against 347 increases. There were more than three times as many voluntary reductions reported as there were increases. None of the reductions reported were ordered by or made through the instrumentality of the Rent Commission. This condition would not exist if there was an emergency or a shortage in housing accommodations. Two hundred and ninety-three of the 347 increases noted were for amounts not in excess of 50 per cent of pre-war rentals. Out of all of the thousands of housing units represented only 78 notices to vacate were served. October 1 was the effective date on which all of this study was based, and as that date is the recognized annual lease date this makes the information gained of more than ordinary significance.

Your attention is called to the fact that while the Rent Commission has been inoperative for several months, the press has prominently mentioned only two cases of evictions. One was for nonpayment