country and, second, the preparation of reports on specific subjects by individual members. The committee's first hearings were informal sessions held with leaders of industry and labor and with Federal officials concerned with housing, held on September 10 and 19 in Washington. The concluding hearings in Washington when more extensive testimony was received were held from January 13 through January 28. One of the principal activities of the committee consisted of the hearings in 32 cities in various parts of the country. The widespread concern and interest in the housing problem was indicated both by the testimony and by the demand for time in each of the cities. With a few exceptions, the rigid schedule limited hearings to 1 day in each city. During a typical 1-day session committee members heard and received statements from 30 witnesses, including city officials; representatives of all phases of the local home-building industry; and leaders of labor unions, veterans' groups, and civic organizations. The subjects covered all phases of the housing problem. In New Orleans a day was set aside to hear mayors and other officials of American cities attending the annual meeting of the American Municipal Association. Hearings were held in the following cities outside of Washington: The other major phase of the committee's inquiry has been the preparation of reports on assigned subjects by individual members. The following reports have been published: Progress reports by Chairman Gamble. General report by Vice Chairman McCarthy. The committee, in addition, has received a report from Representative Boggs on building materials and one from Senator Cain on the effect of existing housing legislation on the shortage and high cost of housing. The hearings and special studies were augmented by informal conferences with leaders in industry and labor. Group conferences were held with producers of pig iron, lumber, gypsum, nails, and other products. At the invitation of the American Federation of Labor, the vice chairman met with leaders in the construction trades-unions at its annual convention in San Francisco. These conferences were most helpful by their addition of facts and opinions and also by pledges of cooperation. These activities of the committee form the basis for the findings and recommendations contained on the following pages. II. THE PRESENT HOUSING SITUATION PRESENT AND PROSPECTIVE HOUSING NEEDS In attempting to get some measure of the magnitude of our present and prospective housing needs, the committee had available to it reports of the Housing and Home Finance Agency and a wide variety of statistics, surveys, and reports from official Government statistical agencies such as the Bureau of the Census, Department of Commerce, and the Bureau of Labor Statistics, Department of Labor, The findings of other investigators of our housing needs were also carefully considered. Our present housing problem is of long standing. While developments attributable to World War II have contributed to the intensity of our present problem, the current shortage actually has been accumulating over a long period of years when the volume of new housing construction was less than the net increase in new families. In the spring of 1947 there were 2,800,000 families living doubled up with other families. The vast majority of these families have been forced to accept these unsatisfactory living arrangements because of the acute housing shortage. An additional 500,000 families are living in temporary housing, trailers, rooming houses, and other makeshift accommodations. Moreover, during the last year, even with the sharp expansion of home building, the net number of new families formed greatly exceeded the number of new homes provided. Finally, a very substantial proportion of our existing supply of housing falls far below minimum standards of decency. So great has been the interest in the extent of our housing problem that a dozen or more groups largely outside the Federal Government have prepared estimates of the volume of housing construction needed during the first decade or so after World War II. One thing is common to almost all of these studies; they conclude that there is a need for new-house construction at an annual rate exceeding the best prewar year for at least a decade if substantial progress is to be made in bettering the housing conditions of the Nation. While the individual estimates vary as to the exact magnitude of the annual requirements, most of them call for nonfarm construction ranging between 1,000,000 and 1,500,000 units a year. The most recent information which has been released by the Bureau of the Census as to the status of the housing inventory leads this committee to conclude that we should have a construction program that will produce at least 15,500,000 nonfarm units between now and the end of 1960. This would call for the average annual construction of not less than 1,285,000 nonfarm units. In addition, there is a large need for better housing in farm areas. This makes it clear that for many years at least 1,500,000 houses should be built annually in the United States. The two tables which follow were used in arriving at the nonfarm estimate. Table I analyzes our present inventory of dwelling units and shows the number which are actually available for practical use by deducting those which are uninhabitable or for other reasons cannot be considered a part of the effective housing supply. Deduct: Vacant units not on market (boarded-up mansions, units sold or rented and awaiting occupants). Effective inventory as of April 1947... 33, 120, 000 391, 000 32, 729, 000 Table II shows the number of nonfarm units that will be needed in 1960 if we are to meet the requirements arising out of our constantly increasing number of families and to provide a margin of 4 percent in vacancies, a rate necessary to permit mobility of the population and reasonable freedom of choice in the selection of a place to live. If account is taken of the fact that during 1947 we added approximately 1,000,000 units to the supply, the first part of the table shows that between the beginning of 1948 and the end of 1960, we will need to add more than 7,300,000 nonfarm units just to take care of the increase in number of families and a reasonable margin for vacancies. But we cannot regard our housing job as ending here. We must undertake the long-overdue job of raising the quality of the Nation's housing by replacing the vast number of units in our present supply which simply does not provide even the minimum decent living conditions that the American people are entitled to. The committee recognizes that there has been some difference of opinion as to the number of such units and the method of identifying them. However, the committee has concluded that a reasonable measure of the replacement requirements would be the number of nonfarm units shown by the reports of the Census Bureau to be in need of major repairs, together with all units in urban areas which lack private inside bath and toilet. The total number falling in these 2 categories in 1947 was close to 5,200,000. It should also be remembered that there are many bad units in the densely populated suburban areas lying outside the boundaries of our largest cities which are not included in the census count for urban areas. Another factor which the committee has taken into account is the probability that many of the standard units in our present effective inventory will deteriorate by 1960 to such an extent that they could not longer be accepted as standard. For example, while age is not necessarily a determining factor, it is surely an important one. Estimates indicate that 3,800,000 units now classified as standard are at least 50 years old and that nearly 2,000,000 are at least 60 years of age. In its estimate the committee makes an allowance of 2,000,000 units for substandard units in suburban areas not included in the census figures for urban areas and for the deterioration of existing standard units. The estimate of the number of units which may deteriorate during the next 12 years probably errs on the low side. Thus, it presupposes an average life for houses of about 75 years, and calls for replacing a little more than one-half of 1 percent of our inventory of standard housing each year. While it is recognized that there will always be some houses which will be maintained in good condition far beyond this age, this is certainly not true of our housing inventory as a whole. In view of the rapid changes which are occurring in our way of living and in the drastic readjustments which are occurring in the character of many of our cities it is not unreasonable to conclude that much of our housing will have outlived its usefulness before it is 75 years old. If a goal were set, therefore, of replacing 1 percent of our housing supply each year during the next 12 years it would require an additional 1,850,000 units. The estimate makes an allowance of 520,000 units which it is estimated will be demolished or removed from the housing supply as a result of fire, windstorm, or other causes. The committee has also had in mind that in our present supply there are some 350,000 temporary war and veteran housing units. Replacement of these temporary units brings the total nonfarm construction need for the 12-year period to a minimum of 15,450,000 if about one-half of 1 percent of our houses are replaced each year, and to 17,300,000 units if 1 percent of our houses are replaced each year. This would mean a rate of construction ranging from about 1,300,000 and 1,500,000 nonfarm houses a year. There is in addition to these nonfarm requirements a substantial need for improving the condition of our farm housing. Some of the Nation's worst housing is to be found in rural areas. Thus, Bureau of Census reports show that proportionately twice as much of the farm housing is in need of major repairs as is true of nonfarm housing. Overcrowding is also more marked in farm housing areas than in nonfarm housing. Again, the proportion of farm houses where this condition exists is double the proportion found in nonfarm dwellings. Despite the fact that no net increase is anticipated in the number of farm families by 1960 much remains to be done in bettering the housing conditions under which out farmers are obliged to live. Estimates of the magnitude of the job to be done in this field range between 200,000 and 300,000 units a year for at least a decade. Taking into account both the farm and nonfarm segments, therefore, housing production over the next 12 years should average at least 1,500,000 units a year and should well exceed that figure in many years. TABLE II.-Additional nonfarm housing needed by 1960 Estimated 1960 families... Total dwellings needed in 1960.. Subtract: Effective inventory shown in table I............... 39, 500, 000 1, 600, 000 41, 100, 000 32, 729, 000 8, 371, 000 1, 000, 000 Net additional number needed between 1948 and 1960 to 7, 371, 000 Number of additional units needed from beginning of 1947.. Subtract: 1,000,000 units added in 1947- Add: TABLE II.—Additional nonfarm housing needed by 1960—Continued For replacement of estimated losses from 1947 to 1960 (fire, For replacement of nonfarm units in need of major repairs and For replacement of substandard units in surrounding suburban For replacement of temporary structures... Total replacement, 1948-60----- Minimum construction needed.--- Add: To bring replacement rate to 1 percent... Optimum construction needed_______ PRESENT HOUSING COSTS AND PRICES 520, 000 5, 200, 000 2, 000, 000 350, 000 8, 070, 000 15, 441, 000 1, 850, 000 17, 291, 000 At the end of 1947, when the committee was conducting its inquiries in Washington and in the field, residential building costs had risen to a level almost double that of 1939. Building-material prices were more than twice as much, while the average hourly earnings of all building-trades workers were up by 80 percent. Senator Flanders' report states that selling prices of existing houses had risen even more, to 130 percent above 1939 by September of 1947. This meant that a house which sold for $6,500 before the war was selling for $15,000. This rise after World War II is similar to the behavior of costs and prices after World War I. Residential construction cost increases exceeded cost of living increases in both postwar periods. The rise has already continued for a longer time after World War II than after the last war. But it would be a mistake to regard the present rise in building costs as merely a postwar phenomenon. Senator Flanders' report draws attention to the fact that there has been a persistent long-run increase in building costs, despite cyclical fluctuations, and that the decline in each successive depression has not reached the low point of the previous one. This long-continued rise in costs reflects a lag in the productivity of our housing industry which makes it compare unfavorably with most other industries. It would not be true to say that no improvements have been made in building methods. But it is true that the rate of improvement has been far below that of many other industries, so that in a relative sense our residential building technology has fallen behind. A vicious circle is created by this lag, in which the high costs resulting from an obsolescent technology make it harder and harder to give the public as much for its money in housing as in other commodities. Prices have responded to the postwar inflationary situation even more than costs. The sharp war and postwar increase in marriages and births, the wartime restrictions on construction and the unsatisfactory state of our housing for some time past, and greatly increased income levels and savings have combined to increase the demand for housing and to push up prices and to keep them there. |