Friday, March 16, 2012

A Home in the Suburbs - Then 1916 and Now 2012

You get a sense that writers of magazine and newspaper articles in 1916 were in competition with each other to see who could use the biggest words and the greatest amount of satire.   Apparently words and wit sold magazines and they were full of it.   I got the feeling that the journalists were encouraged to pad each article with as many words as possible in order to fill up space since most of the articles I've read could have been easily condensed to about half their size without losing any meaning.   And I can see why they became obsessed with words - it's habit forming!  As I was writing this, I found myself dangerously teetering on adopting their writing style.....see.....all these unnecessary words I'm using? 

The magazine was The Country Gentleman, the date was May 20, 1916 and the article was Financing the Suburban Home - What You Should Pay and How You May Get the Money.

The article started off with Mrs. Thomas Wren returning home to their rented flat relaying to her husband that she's just seen the "lovliest house bargain!"  Notice the use of her husband's name and not her own.  Her name could have been Molly, Amanda or Mary, but apparently in 1916, the wife's given name was not worth mentioning.  I suppose the use of her husband's name gave her status.  The new bride was excited about "6 rooms and a bath", a cute little Friday Special Suburbia doll-house that had been reduced from $5000 to $4978.  Mr. Wren was chiding her about thinking $22 savings was such a bargain and said they could not afford such a costly sum.  However, he fell for a bargain soon after by starting out looking at a $4000 home and letting a real estate agent persuade him to invest $5685 at so much down and so much a month - with the mentality that "the Sheridans are going to spend $6000 for their new home and aren't we as well off as they are"? 

In 1916, the amortized mortgage was a novelty for someone about to embark on a home purchase.  So much so that a formula had not been set forth on how much a young couple could afford for a mortgage.  Government regulation had not long been implemented in the building and loan associations, because even then, enterprising schemers were abundantly on the scene.  Up until that point, the classic mortgage had been for the bank to loan money, the borrower would pay interest until the set time that the lump sum would come due.  This method increased the odds for losing the old family homestead.

The writer went on to encourage paying cash.  I loved how he used the descriptive / comparison jargon style of writing - comparing methods of finance to styles of clothing.  Here's what he had to say:
There are styles in finance as in clothes and cash is in vogue this season.  A couple of years ago, the financial tailors were displaying nobby credit suits.  They warbled that the world was built on credit, debt was a blessing and the more a nation owed, the better off it was.  Things have changed.  A lot of foreign dandies are strutting around in our pants and it is doubtful if they have the price.  Consequently we have revised our philosophy as to the benefits of credit and we advise home seekers as all others that cash is the mode.  A cash buyer  avoids extravagance at the start --- and sleeps well at night.  Interest is an insect that never sleeps, gnaws constantly at your principal and devours more than half of it in ten years.

Remember that I said earlier there was not a formula for what a buyer could afford.  The writer has a solution in the next paragraph.  The further we get from cash, the more we pay.  It is a good thing to embark on home ownership with at least one third of the total value in ready money.  Conservative lenders will advance at the utmost about $2 where the owner puts in $1.  Such a deal spells safety to them and ought to be a hint of the safety limit for the would be owner.

With the writer's formula at work today, very few people would be homeowners.  A starter home today would be over $100,000.  How many young couples could come up with a $50,000 down payment - they would be hard put to come up with half that.

In 1916, the average city/suburbia home buyer's salary was $40 per week and their average home purchase was $4000.

But back to Mr. and Mrs. Wren who we met in the beginning of this article.  Their attempt to keep up with the Sheridans (aka the Joneses) stretched their budget and put them in jeopardy of losing their home.  Now that sentence sounds as if it came right out of any newspaper article in the last five or six years.

Savings and loan bailouts, failed mortgages, borrowing more than the bank should lend you.  Old news makes new news.  It's true - the more things change, the more they stay the same.
Typical Suburbia Bungalow style home in early 20th century.


  1. I just love that bungalow style home from the early 20th century! You're right of course, nothing really changes, does it?! This has certainly been an interesting series of posts, which I am very much enjoying.

  2. Hello Glenda
    I too have been fascinated by your posts taken from these magazines. You're right you know - my Mother would often say 'Nothing changes in the world - you come in the same way and you go out the same way' She could be a miserable old so and so at times but now and again she's get it right lol
    Love the thought of paying cash for a house - be nice wouldn't it :))
    Take care

    Cathy @ Still Waters


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