A Plan for 1,000,000 Homes

After three work-packed days and nights in Washington last week, President Eisenhower's 23-man advisory housing committee finally drafted a new federal housing program. When the meeting was over, a banker pushed away from the paper-strewn conference table and said: "Well, the builders didn't get the keys to the U.S. Treasury."

But the housing industry did get a new program that it hoped would keep building going close to its present pace of 1,000,000 housing units a year. At the same time, it appeared to satisfy all the other housing interests represented on the committee--unions, bankers, public-housing advocates, et al. Since it is virtually axiomatic that no two groups in the building industry agree on anything, the outcome of the committee's work was a tribute to its chairman, Federal Housing Chief Albert Cole.

The Referee. Cole started with two strikes against him when he was appointed by Eisenhower last winter to head the top Government housing agency. Since Cole had consistently opposed the present housing program while he was a Kansas Congressman, his appointment was attacked by unions and public housing groups. But he has worked hard to allay their suspicions.

Early last summer, he started a series of "shirtsleeve" conferences with various housing interests around the country. When Eisenhower named the advisory housing committee last September, Cole split the committee into five working bodies and, in less than three months, gathered testimony from more than 200 groups and individuals. He quickly showed that he had no intention of scuttling Government housing activities.

Virtually every point raised at last week's meeting was shot through with controversy. For example, the builders, who want low interest rates, easy credit and long-term mortgages, battled with the banks and insurance companies, who want higher rates and shorter-term mortgages. But differences were ironed out, and the committee finally agreed on a set of recommendations to send to the President.

The Program. While the details of the report will not be announced until the White House gets a chance to review it, much of it has already leaked out in broad outline. Some of the recommendations:

P: To provide more housing for low-income families, FHA would be allowed to insure mortgages up to 40 years (v. 30 years now) on houses priced up to $7,600 (or $8,600 in some high-cost areas). At current interest rates, monthly carrying charges would be cheaper than rent, i.e., $33.76 on a $7,000, 5% mortgage.

P: To put low-cost older houses on a par with new houses, FHA would be permitted to insure mortgages on owner-occupied older houses up to 95% of the FHA appraised value, the same as on new houses (compared to the present 80% limit).

P: The present low level of public-housing construction (about $40 million a year, enough to build 20,000 housing units) would be continued.

P: As a compromise in the interest-rate squabble, a maximum rate for FHA-insured loans would be set at 2 1/2% above the going yield for long-term Government bonds (at present rates, roughly 5 1/2%).

P: The limit on FHA-insured home-repair loans would be increased from the present $2,500 ceiling to $3,000 or $3,500, and the term of the loans extended from three years to ten.

This file is automatically generated by a robot program, so reader's discretion is required.