TABLE 66.-Average characteristics by property valuation: Based on FHA-insured mortgages, with second mortgages guaranteed by the Veterans' Administration, secured by existing single-family homes, section 203, 1947

1 FHA property valuation includes valuation of the house, all other physical improvements, and land. 2 Data shown are medians.

3 The value of the land is estimated by FHA as including rough grading, terracing, and retaining walls if any.

Includes real-estate taxes, special assessments if any, and water rent provided its nonpayment results in a lien against the property.

Includes monthly payment for first year to principal, interest, FHA insurance premium, hazard insurance, taxes and special assessments, and ground rent if any.

The monthly rental value is estimated on the basis of typical year-round tenant-occupancy, excluding any premium obtainable because of local housing shortages or newness of the individual property.

TABLE 67.-Average characteristics by necessary current cost: Based on FHAinsured mortgages with second mortgages guaranteed by the Veterans' Administration, secured by new single-family homes, section 603, 1947

The FHA estimate of the necessary current cost of the property includes the cost of house, all other physical improvements, and land.

2 Data shown are medians.

The value of the land is estimated by FHA as including rough grading, terracing, and retaining walls if any.

Includes monthly payment for first year to principal, interest, FHA insurance premium, hazard insurance, taxes and special assessments, and ground rent if any,

Includes real-estate taxes, special assessments if any, and water rent provided its nonpayment results in a lien against the property.

The monthly rental value is estimated on the basis of typical year-around tenant occupancy, excluding any premium obtainable because of local housing shortages or newness of the individual property.

7 Less than 0.05 percent.

Data not significant.

A comparison of table 65 with table 14 (page 34), which presents similar data for all new single-family home mortgages insured under section 203 during the year, shows more of the "505" cases in lower valuation groups than is true for total cases. More than 54 percent of the "505" properties were valued at less than $7,000-the average valuation being $7,085-compared with only about 38 percent for the larger group, whose homes averaged $7,817. However, within individual value groups, the characteristics of the veterans' "505" transactions follow the same pattern in relation to valuation as that established for all new-home buyers who financed their purchases with section 203 insured mortgages, with only small variations between reports on "505" cases and total cases. The average mortgage principal and land valuation were slightly higher as a rule for veteran "505" transactions. than was the case for all home purchases in similar value groups, although (due to the larger proportion of "505" cases in the lower valuation intervals) the average loan and land valuation for all "505" loans were lower than the corresponding figures for all cases. The room count and proportion of structures with garages were also slightly lower for the "505" homes than for the larger group.

A similar comparison may be made for existing-home mortgages insured under section 203 (tables 66 and 15). These homes are also more heavily concentrated in the less than $7,000 levels-more than three out of four for veteran purchasers with VA-guaranteed second mortgages, compared with only about one out of two for all buyers of existing dwellings. The various averages for the two groups of home buyers have about the same relationship to each other as mentioned above in connection with new-home mortgages.

The necessary current cost for "505" cases insured by FHA under section 603 (table 67) averaged considerably higher than the property valuations for new homes securing "505" mortgages insured under section 203-$7,911 for the section 603 cases compared with $7,085 for the section 203 insured mortgages. Also, in contrast to section 203 comparisons, the distribution of "505" cases by current cost approximated the distribution for all section 603 cases (table 39, page 57)some 71 percent of the new homes securing veterans' "505" mortgages insured under section 603 were in the cost interval from $6,000 to $8,999. Within cost groups there were few differences between "505" and other section 603 cases, but because of a slightly lower typical cost the average mortgage principal for all "505" cases under section 603 was over $200 lower than the average for all mortgagors—an average of $6,680 for all GI purchases with "505" loans.

Mortgage Principal

Reflecting the lower age and lower income of "505" mortgagors discussed above, mortgage amounts insured in "505" cases under either

section 203 or section 603 were typically lower than those reported for all mortgages insured under those sections.

More than 31 percent of the "505" new-home mortgages insured under section 203 involved loans of from $5,000 to $5,999. The total of 56.6 percent under $6,000 is 12 percent higher than for all newhome mortgages insured under this section-the median mortgage being $5,672 for section 203 properties involving VA-guaranteed second mortgages compared with $6,201 for all new-home mortgages. A similar condition may be noted in connection with the "505" existing-home mortgages insured under section 203. The modal group-$4,000 to $4,999-includes more than a third of the veterans' cases. Eighty percent of these loans were for less than $6,000—16 percent more than for all section 203 existing-home loans, which had a median of $5,363, nearly 10 percent over the veterans' median loan of $4,890.

As the following table shows, new-home mortgages involving VAguaranteed second mortgages which were insured under section 603 ran somewhat higher than those insured under section 203. About 66 percent of these section 603 cases covered loans of from $6,000 to $7,999, and only 25 percent were for less than $6,000. The median of $6,680 for "505" cases is about $200 below the typical amount of $6,914 for all section 603 cases but more than $1,000 higher than the median for "505" cases insured under section 203.

TABLE 68.-Amount of mortgage principal: Based on FHA-insured mortgages, with second mortgages guaranteed by the Veterans' Administration, secured by single-family homes, sections 203 and 603, 1947

Exterior Material for Single-Family Homes

Tables 69 and 70 show the distributions of the preponderant exterior materials of construction for homes purchased by veterans during 1947 with "505" mortgages insured under sections 203 and 603, together with the corresponding average valuation or necessary cur

rent cost, and the average number of rooms. Comparable data for all single-family homes covered by mortgages insured during 1947 are shown in table 18 for section 203 transactions and in table 42 for homes securing mortgages insured under section 603. A study of these tables indicates that "505" transactions involved more homes of wood or asbestos shingles than was the case for other home purchases. It is interesting that, while the average valuation or cost corresponding to specific materials of construction is uniformly lower for "505" veteran-purchased homes, the average room count is not proportionately smaller. This is particularly true in connection with TABLE 69.-Average characteristics by preponderant exterior material: Based on FHA-insured mortgages, with second mortgages guaranteed by the Veterans' Administration, secured by new and existing single-family homes, section 203, 1947

1 FHA property valuation includes valuation of the house, all other physical improvements, and land. Excludes bathrooms, toilet compartments, closets. halls, and similar spaces.

3 Distribution by type of exterior material not available.

TABLE 70.-Average characteristics by preponderant exterior material: Based on FHA-insured mortgages, with second mortgages guaranteed by the Veterans' Administration, secured by new single-family homes, section 603, 1947

1 The FHA estimate of the necessary current cost of the property includes the cost of the house, all other physical improvements, and land.

2 Excludes bathrooms, toilet compartments, closets, halls, and similar spaces. Distribution by type of exterior material not available.

properties securing section 603 mortgages. The typical veteran's home, constructed with wood siding, had an average current cost of $7,601 for 4.6 rooms, compared with $7,648 for all purchasers of wood houses of the same average size. The difference is more marked in the case of brick or stone homes, which averaged 5.0 rooms for both groups of mortgagors-homes purchased by veterans having, however, an average cost of $8,741, compared with $8,907 for all buyers.

PROPERTY IMPROVEMENT LOANS INSURED UNDER TITLE I

During the first 6 months of 1947, title I insurance for property improvement loans continued under the July 1944 reserve. A new reserve was established as of July 1, 1947, with new insurance contracts to all participating institutions, when an amendment of the National Housing Act extended the authority of the FHA Commissioner to continue title I insuring operations until June 30, 1949.

Regulations issued by the Commissioner in accordance with legislative authorization in the National Housing Act describe the classes of loans which are eligible for insurance under title I, the terms of these loans, and the extent of FHA insurance. The terms and financing charges permitted for each class of loan are summarized on page 15 of this report.

Again in 1947, following the trend established during 1946, the volume of title I insurance surpassed that of any single year since the beginning of operations in 1934. In fact, the 1,248,000 property improvement loans with net proceeds to borrowers totaling $533,604,000 represented an increase of more than 56 percent in number and 66 percent in dollar volume over the previous peak year of 1946. Moreover, the amount of the 1947 loans accounted for approximately 30 percent of the amount of insurance written by FHA under all titles of the act during the year. The cumulative volume of all loans insured under title I had reached approximately 7,400,000 with net proceeds to borrowers amounting to $2,716,900,000 at December 31, 1947.

By December 31, 1947, the Commissioner had approved under title I the payment to lending institutions of 223,500 claims for insurance amounting to $60,400,000. Recoveries on claims paid totaled $32,300,000, consisting of cash collections of $27,300,000, net cash proceeds of nearly $800,000 resulting from the disposal of real properties, as presented in Statement 4 on page 118, and anticipated future cash collections of $4,200,000 from $13,600,000 of notes or other acquired security still "in process" of collection. As of the same date, there were classed as "in suspense" notes on which net claims had been paid totaling $14,500,000 on which no further recoveries are anticipated. When these recoveries are deducted from gross claims paid,