No major industry has been hit harder than housing by Washington's fight against inflation. By tightening credit, the Federal Reserve Board has sharply cut the supply of mortgage money; over the past twelve months, starts of new homes and apartments have dropped by 25%. Last week the Administration reluctantly raised the interest-rate ceiling on Government-backed home mortgages in an effort to draw more funds into homebuilding. The rate went up from 7½% to a record 8½%, effective this week, for Federal Housing Administration and Veterans Administration home loans. Because FHA borrowers must also pay a ½% insurance fee, the actual...
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