Some Considerations of the Lowering of Interest [18]
when Money is at 5 per Cent. of 2500 l. when Money is at 4 per Cent. One would conclude, I say, that Land should Sell in proportion to Use, according to these following Rates, viz.
When Money is at 10 per Cent. for 10 years purchase. 8 12 1/2 6 16 2/3 5 20 4 25
But Experience tells us, that neither in queen Elizabeth, nor king James the First Reigns, when Interest was at Ten per Cent. was Land Sold for Ten; or when it was at Eight per Cent. for welve and an half years purchase, or any thing near the low rate that high Use required (if it were true, that the rate of Interest govern'd the price of Land) any more than Land, now yields Twenty Five Years Purchase, because a great part of the Monied Men will now let their Money upon good Security at Four per Cent. Thus we see in fact how little this Rule has held at home: And he that will look into Holland, will find, that the Purchase of Land was not raised there, when their Interest fell. This is certain, and past doubt, that the legal Interest can never regulate the price of Land, since it is plain, that the price of Land has never changed with it in the several Changes have been made in the rate of Interest by Law: Nor now that the rate of Interest is by Law the same through all England, is the price of Land every where the same, it being in some parts constancy sold for four or five Years Purchase more than in others. Whether you or I can tell the Reason of this, it matters not to the question in hand: but it being really so, this is plain Demonstration against those, who pretend to advance and regulate the price of Land by a Law, concerning the Interest of Money. But yet I will give you some of my Guesses, why the price of Land is not regulated (as at first sight it seems it should be) by the Interest of Money. Why it is not regulated by the legal Use is manifest, Because the rate of Money does not follow the Standard of the Law, but the price of the Market; and Men not observing the legal and forced, but the Natural and Current Interest of Money, regulate their Affairs by that. But why the rate of Land does not follow the Current Interest of Money requires a farther Consideration. All Things that are Bought and Sold, raise and fall their price in proportion, as there are more Buyers or Sellers. Where there are a great many Sellers to a few Buyers, there use what Art you will, the thing to be Sold will be cheap. On the other side, turn the Tables, and raise up a great many Buyers for a few Sellers, and the same thing will immediately grow dear. This Rule holds in Land as well as all other Commodities, and is the Reason, why in England at the same time, that Land in some places is at seventeen or eighteen Years Purchase, it is about others, where there are profitable Manufactures, at two or three and wenty Years Purchase: Because there (Men thriving and getting Money by their Industry, and willing to leave their Estates to their Children in Land, as the surest, and most lasting Provision, and not so liable to Casualties as Money in untrading or unskilful Hands) there are many Buyers ready always to Purchase, but few Sellers. For the Land thereabout being already possessed by that sort of Industrious and Thriving Men, they have neither need, nor will, to Sell. In such places of Manufacture, the Riches of the one not arising from the squandring and waste of another, (as it doth in other places where Men live lazily upon the product of the Land) the Industry of the People bringing in increase of Wealth from remote Parts, makes plenty of Money there without the impoverishing of their Neighbours. And when the thriving Tradesman has got more, than he can well employ in Trade, his next Thoughts are to look out for a Purchase, but it must be a Purchase in the Neighbourhood, where the Estate may be under his Eye, and within convenient distance, that the Care and Pleasure of his Farm may not take him off from the Engagements of his Calling,
When Money is at 10 per Cent. for 10 years purchase. 8 12 1/2 6 16 2/3 5 20 4 25
But Experience tells us, that neither in queen Elizabeth, nor king James the First Reigns, when Interest was at Ten per Cent. was Land Sold for Ten; or when it was at Eight per Cent. for welve and an half years purchase, or any thing near the low rate that high Use required (if it were true, that the rate of Interest govern'd the price of Land) any more than Land, now yields Twenty Five Years Purchase, because a great part of the Monied Men will now let their Money upon good Security at Four per Cent. Thus we see in fact how little this Rule has held at home: And he that will look into Holland, will find, that the Purchase of Land was not raised there, when their Interest fell. This is certain, and past doubt, that the legal Interest can never regulate the price of Land, since it is plain, that the price of Land has never changed with it in the several Changes have been made in the rate of Interest by Law: Nor now that the rate of Interest is by Law the same through all England, is the price of Land every where the same, it being in some parts constancy sold for four or five Years Purchase more than in others. Whether you or I can tell the Reason of this, it matters not to the question in hand: but it being really so, this is plain Demonstration against those, who pretend to advance and regulate the price of Land by a Law, concerning the Interest of Money. But yet I will give you some of my Guesses, why the price of Land is not regulated (as at first sight it seems it should be) by the Interest of Money. Why it is not regulated by the legal Use is manifest, Because the rate of Money does not follow the Standard of the Law, but the price of the Market; and Men not observing the legal and forced, but the Natural and Current Interest of Money, regulate their Affairs by that. But why the rate of Land does not follow the Current Interest of Money requires a farther Consideration. All Things that are Bought and Sold, raise and fall their price in proportion, as there are more Buyers or Sellers. Where there are a great many Sellers to a few Buyers, there use what Art you will, the thing to be Sold will be cheap. On the other side, turn the Tables, and raise up a great many Buyers for a few Sellers, and the same thing will immediately grow dear. This Rule holds in Land as well as all other Commodities, and is the Reason, why in England at the same time, that Land in some places is at seventeen or eighteen Years Purchase, it is about others, where there are profitable Manufactures, at two or three and wenty Years Purchase: Because there (Men thriving and getting Money by their Industry, and willing to leave their Estates to their Children in Land, as the surest, and most lasting Provision, and not so liable to Casualties as Money in untrading or unskilful Hands) there are many Buyers ready always to Purchase, but few Sellers. For the Land thereabout being already possessed by that sort of Industrious and Thriving Men, they have neither need, nor will, to Sell. In such places of Manufacture, the Riches of the one not arising from the squandring and waste of another, (as it doth in other places where Men live lazily upon the product of the Land) the Industry of the People bringing in increase of Wealth from remote Parts, makes plenty of Money there without the impoverishing of their Neighbours. And when the thriving Tradesman has got more, than he can well employ in Trade, his next Thoughts are to look out for a Purchase, but it must be a Purchase in the Neighbourhood, where the Estate may be under his Eye, and within convenient distance, that the Care and Pleasure of his Farm may not take him off from the Engagements of his Calling,