The company began offering mortgage loans in 1911. Easy payment plans and lax loan qualifications made home-buying attainable by the masses. A 1924 Sears mortgage application, like the one at right, asked a few simple questions about the house and building lot, but only asked one financial question: "What is your vocation?".
The Modern Homes department was never a big money maker for Sears however, and by 1932, its financial health was sliding downhill. Profit margins had grown thinner through the years and the situation worsened as the country struggled through the Great Depression. The 1932 Sears, Roebuck and Company annual report disclosed that the Modern Homes department was operating at a loss, with sales dropping 40% in one year. For the next few years, there would be glimmers of hope for recovery, but the losses of 1932 marked the beginning of the end for the catalog home sales.
Historical accounts of the rise and fall of the Sears catalog homes are often contradictory. In January 1932, the Wall Street Journal reported that Sears would build its 100,000th house during the year. One hundred thousand homes made for good press, but Sears' own numbers make me suspect that total had been "puffed" a bit. A small paragraph on page four of the 1930 Honor-Bilt Modern Homes catalogue stated that Sears had now sold more than 48,000 homes. (In the 1929 catalogue, that number was 44,200.).
A small column in the January 22, 1931 Chicago Tribune stated that in 1930, there had been a 53% drop in home construction (housing starts) nationwide. Catalogues and Counters: A History of Sears Roebuck and Company (Boris Emmet & John Jeuck) states that sales of Sears Homes also dropped, from their peak of $12 million in 1929 - to $8 million in 1931, $6 million in 1932 and $3.6 million in 1933. .
The Wall Street Journal article that reported this 100,000 number cited Sears as their source. With this precipitous drop in sales, however it seems very unlikely that Sears could have sold 52,000 homes between 1930-1932.