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| Revisit Housing Policy |
| Revist Housing Policy - Part 2 |
| Revisit Housing Policy - Part 3 |
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Proper housing is an essential part of decent human rights and the development of a just society. For those of us who have proper housing, we can be virtually blind to the plight of those who do not. We now have a new government—the People’s Partnership (PP)—and given the swirling claims and counter-claims around State housing, it is important to reopen this discussion.
The first aspect of housing policy to be considered would have to be the basic model: what is it?
The main housing policy of the first UNC government was to provide serviced lots, that is, land was acquired and developed with infrastructure (roads, drainage, electricity and water supplies etc,) before being distributed. That approach is based on the notion that it allowed the State to have a positive impact on the housing shortage with the use of limited resources. Between 1995 to 2001, that policy yielded a modest result, since only about 2,200 service lots were sold with 376 new homes built.2002 targets not achieved
The current national housing policy was initiated in September 2002 with the stated goal being 100,000 new homes to be built in a decade. The annual target was soon reduced to 8,000, with those new homes to be sold to applicants. The aim was to increase the quantity and quality of housing available to those who were unable to afford housing in the open market. That programme never achieved its targets and there was a consistent pattern of overstating its achievements. The last claims we heard were that the total output had been adjusted (downward, of course) from 26,000 to only 15,394 new homes in the seven-year period from 2003 to 2009.
In terms of gross output, the PNM policy easily outstripped the UNC’s, even if, in terms of its own targets, it was a signal failure. From the aspect of output versus target numbers, the results are so mixed that it is difficult to settle the question of which policy was the more successful one. For me, a key test of a housing policy’s success would have to be the number of people who have benefitted from an improvement in the quality of their housing. In that case, the existing policy is seriously wanting, since, despite the output of 15,394 new homes, most of those remain in the hands of the Housing Development Corporation (HDC). Just like with the actual numbers built, there has been a pattern of cover-up, shifting figures and plain dishonesty. Despite my efforts, I am unable to locate a published record of how many of these new homes have been given out.
Qualifying for a mortgage
Dr Roodal Moonilal, we need a clear statement of just how many new, empty homes the HDC has on its hands. I went to the 2007 conference of the Caribbean Association of Housing Finance Institutions (CASHFI). The permanent secretary of the Ministry of Housing said that a major issue was the fact that about 90 per cent of the people on their waiting list could not qualify for a mortgage. If the objective of the existing model is to promote home ownership in preference to rental units and 90 per cent of the applicants cannot afford to buy, there is a clash between those policies and the reality of the needy.
New forms of housing finance were devised to overcome that hurdle and those included mortgages:
- at 2.0 per cent;
- with zero-per cent deposits;
- even 100+per cent models which allowed the new home owner to spread the cost of appliances and furnishings over the period of the mortgage.
Return of rent control
We need to reconsider our housing policy in fundamental terms:
What is the extent of housing need in our country?
In last week’s BG View, there was a call for the national pensions proposals to be based on the results of the 2010 census.
The review of national housing policy must be based on realistic housing need data and that should also emerge from the census later this year.
In A critique of State Housing Policy, published on August 2, 2007, I proposed that our country has a five-part housing market. In my view, the task would be to determine the numbers occupying each parts and which of them we intend to provide for.
Is large-scale construction the only way to assist those in housing need?
Another aspect which needs review is the matter of rent control, since that is a cheap way of assisting those in housing need without spending vast sums of taxpayers’ dollars. The reality is that although rent control legislation remains on our law-books, the rent control boards which regulate that area of civic affairs have been allowed to wither and die. Rent control is a thorny housing policy issue, but it deserves a a second thought, since so many of our needy citizens occupy rented housing.
Are we at realistic limits in terms of tenure?
To make a simple contrast, in 1992, when United States President Bill Clinton launched his expansionary proposals to ramp-up home-ownership, about 62 per cent of the homes in the US were owner-occupied. At the end of 2008, after a massive and disastrous experiment intended to increase home ownership, about 68 per cent of US homes were owner-occupied. Our current home ownership percentage is about 76 per cent. Given the poverty of those on the waiting list, does it really makes sense to keep on building new homes for sale to poor people? Are we at the “limits to growth” where home-ownership is concerned?
What types of homes should we build?
Large swathes of agricultural land have been “paved-over” to build these new homes, which is to the permanent detriment of our food security, to name just one obvious concern. The fact is that we do not have enough land in this country to continue that pattern of large scale development.