Fri | May 26, 2017

A home for one, a home for all

Published:Sunday | September 27, 2015 | 9:00 AMDelroy Chuck, Contributor
mortgagehousinghouse for real estatekeys
An aerial view of sections of Portmore in St Catherine.
Delroy Chuck
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In a modern, civilised society, a home is definitely the most basic comfort. When we retire at nights, we want to be secure, feel our family is safe and know our children live in a caring and relaxing environment. Our home is our castle, our own space, where we find peace of mind, privacy and the freedom to be ourselves. To own a home is the ultimate commitment to live, work and raise a family in one's country.

Every country has a duty to create opportunities for its citizens to purchase a home. When I entered politics, one of my great hopes was, and still is, to promote homeownership. Too many young, skilled and ambitious Jamaicans migrate as opportunities for advancement, including the ability to own a home, and disappear in the horizon. My vision remains for Jamaicans to be committed to Jamaica, to make Jamaica better and create opportunities for themselves and others, instead of seeking opportunities elsewhere and racing to greener pastures overseas.

Interestingly, when I served on the staff at the University of the West Indies, first in Bridgetown, Barbados, I exercised my duty to purchase my first home as a young married man. Later, after transferring to the Mona campus, I sold it in order to purchase my present home where I have lived comfortably for the past 28 years. While at the Mona campus, I served as chairman of the University Housing Committee that allocated homes to staff members. I was appalled to hear from lecturers who had served the university for decades requesting to move to larger and better accommodations to fit in with their new status, after promotions or extending their families, and wondered why they had not bought homes of their own instead of relying on the university to

provide accommodation.

I encouraged dozens of them to get out of the comfort of living in university houses and buy one of their own, in which they could live and/or retire if and when they left the university. Many, up to this day, still thank me for the advice. Since then, I have encouraged every person who pays rent to buy a home and pay mortgage instead of rent. I have persuaded and assisted my staff and others close to me to acquire homes. In truth, homeownership is not only a right but a duty of every working person.

 

urban renewal

When I spoke in Parliament on Tuesday, September 1, in the State of the Constituency debate, I did not make clear my vision of every Jamaican owning a home. I suggested that sections of depressed areas in Kingston and Southern St Andrew should be acquired by government, and joint venture agreements made with private developers to engage in a massive programme of urban renewal. Many of the houses in these areas such as Vineyard Town, Allman Town, Rollington Town, Franklin Town, Richmond Park, and surrounding areas are now derelict, over 80 years old, steadily deteriorating and fast becoming slums. They are in need of urgent rehabilitation but the owners do not have the resources to rebuild or upgrade them, and many cannot get a good sale price if they even wanted to sell. Some commentators took offence and argued that I wanted to chase poor people out of their homes as I sought a process of gentrification. Nothing could be further from the truth. In fact, very few poor people own these homes. These areas were the hitherto prestigious and salubrious residential communities and are still inhabited by retired and hard-working Jamaicans but their houses are disintegrating and in need of urgent renewal.

 

joint ventures

What I am proposing is nothing innovative. It has happened in most big cities and is actually happening in many middle-class areas of my constituency of North East St Andrew. How is it done?

Developers are busily searching for private residences in Northern St Andrew to engage in private joint ventures to the benefit of existing homeowners, the developers and potential homeowners. Thus, a private residence of usually much less than an acre is acquired or a joint venture is agreed whereby the developer proposes to build apartments and town houses on the property, offering the existing homeowner two or more of the apartments and/or a substantial cash payment.

These private homeowners are very happy as they oftentimes benefit to the tune of 50 or more million dollars in cash or new buildings, which are usually much more than twice the value of their original residence. And, the foregoing is a fact, not fantasy, as I am fully aware of the many joint ventures in my constituency. Thus, when I read Carol Archer's commentary, 'Chuck that flawed housing proposal' in The Gleaner of September 21, I had to chuckle.

She writes, quite incorrectly, that: "The poor family who sells the dilapidated house in Annette Crescent in Mr Chuck's constituency for $14 million is not able to afford one of the units in the multistorey apartment replacement." Sadly, she clearly doesn't know or understand what is happening. Where joint ventures are developing in Northern St Andrew, everybody is happy save and except the contiguous owners who prefer to live in single-family residential neighbourhoods instead of having apartments and gated communities beside them.

In truth, the character of many communities in Northern St Andrew has changed and is changing in a most disorderly and disorganised manner. While some developments are attractive and appealing, most are simply out of character with the neighbourhoods. Moreover, these developments consist of nothing but concrete and parking areas, as there is simply not enough land to provide for desirable amenities, open and green spaces. While these developments are continuing, prospective homeowners have to pay premium prices as the developers have many challenges to overcome. And, as the demand for these apartments and town houses is insatiable, developers make a hefty profit, as the prices are more than 50 per cent of their true replacement cost. In fact, if these properties were built in South East or East Central St Andrew, the developers would not get more than two-thirds of the prices they are now selling for in Northern St Andrew.

 

Open green spaces

With the demand for reasonably priced homes, developers are building in St Catherine on agricultural lands and far away from Kingston. While these homes are selling at reasonable prices, purchasers have to travel long distances every morning and evening and encounter traffic congestion. This trend is likely to continue, as many homeowners want a single-family unit and like the idea of open green spaces around their home. However, the available land will not be enough to build the over 300,000 homes that are required to accommodate Jamaicans over the next 10 to 20 years and, frankly, most of these lands should be returned to agriculture, especially with crops to feed our people.

Moreover, there are many older wage earners and young professionals who prefer to live in apartments and town houses to avoid the cost to maintain the yard. Actually, in many big cities, high-rise apartments are the normal and preferred developments, as land is scarce and expensive. If Kingston and Southern St Andrew is once again to become attractive and alluring, and be the business centre of Jamaica and the Caribbean, we will have to envisage and start to build high-rise buildings to accommodate businesses and residences. The single-family unit on an acre or less of land in these areas will be a thing of the past. Just think of a country, nay, a city-state, like Singapore, which provides housing for over five million citizens on a land space about the combined size of Kingston and St Andrew, with most of them living in high-rise apartments but many living in two-storey town houses. Singapore, which had the same socio-economic status as Jamaica at independence in 1962, did not believe its people had to remain poor and that the poor would always be with them. Its founding father, Prime Minister Lee Kuan Yew, had a vision of all Singaporeans emerging from poverty, owning their homes, and he achieved it. We, too, must dream and ensure that every Jamaican can one day own a piece of this blessed rock we call Jamaica.

 

needed apartments

It is time we get started and provide the needed apartments and mortgages for our young professionals and the many teachers, nurses, policemen, civil servants, etc., to purchase homes within the $6 million to $15 million range. How will they be able to do so? First, the homes must be built, and second, they must be able to afford mortgages to buy them. My proposal calls for the acquisition of properties in the depressed communities in tracts of at least five or more acres that would allow for enough town houses and apartments to be built with adequate provision for amenities and open and green spaces. I would expect that there would be a mixture of town houses and studio, one and two-bedroom apartments and hopefully providing for at least 120 new housing solutions, selling for $6-15 million.

The acquisition of maybe 15 or 20 adjoining homes in these neighbourhoods should not be hostile but based on competitive market prices and cooperation of residents.

Similar to what happens in Northern St Andrew, homeowners could be offered cash payment and one of the apartments or town houses when they are built. In fact, the cash payment should be enough for the homeowner to buy another home of similar value elsewhere and still have the option to get one of the newly built apartments as a part of the bargain. Naturally, the question is, where is the money? The response is obvious. The National Housing Trust (NHT) should be the vehicle to acquire these tracts of land and provide funds to private developers to build and then sell these properties in the price range for its contributors to buy them. It is about time NHT steps up to the plate and properly discharge its mandate of providing homes for its contributors, instead of expending billions to bail out failed speculators and an indebted central government.

 

shocking disgrace

Contributors to the NHT should be given a better deal. Many of the nurses, policemen, teachers, civil servants and others contributing to the NHT cannot afford to buy an apartment or house for over $10 million. This is a shocking disgrace. It would be interesting to know how many government workers own a home, when it should be the norm for every worker. The problem is that mortgages are too expensive and NHT has done nothing to alleviate the problem. Why should NHT mortgages be at an interest rate of seven per cent for contributors earning more than $20,000.00 per week? In fact, why should mortgage rates in Jamaica be so high, over nine per cent, and in many cases over 12 per cent, when in most countries it is less than five per cent? I think it is time we start thinking of reducing all mortgage rates to five per cent or less, soon.

NHT could start by reducing its highest mortgage rate to four per cent even if this means reducing the rate paid to contributors to 1-2 per cent. If mortgage rates fall to five per cent, then more of our people could afford houses in the $6-$15 million range. Additionally, NHT should raise the maximum available to contributors from $4.5 million to $6 million. If that were done, along with the reduced interest rates, then the vast majority of government workers - in fact, all workers - could combine in pairs to buy homes for $10 million and more.

 

affordable houses

Admittedly, I have concentrated on the depressed areas of Kingston and St Andrew but the same arguments apply to all the towns and parish capitals. Certainly, in the tourist resort areas, the need for affordable houses for hotel workers is a national emergency. These workers have to travel long distances every day to get to work and spend a significant part of their salaries on transportation. In and around these tourist resort areas, NHT or National Housing Development Corporation should quickly engage in building affordable houses and, as proposed, with reduced mortgage interest rates, many of these workers could afford a home.

 

time and money

What about the individual parcels of land in rural and suburban areas? The real challenge is for the occupiers to have certificate of titles for the occupied land, which can be used as collateral to get mortgages. It may not be well known, but I assisted the Jamaican Government to enter into a highly beneficial land titling programme with the South Korean agency KOREAN CADASTRAL SURVEY CORPORATION to totally map the whole of Jamaica and provide titles for every square metre of land here. When the contract was signed in 2009 for the Land Administration and Management Program (LAMP) to work with Geoland (the Korean Jamaican company), we expected that over 10,000 titles would be issued annually and the process could be completed in 10 years. Unfortunately, under the present administration, just around 1,000 titles are issued annually, usually at ceremonies for the prime minister or the government to make public-relations presentations, when the time and money could be better used to issue more titles. At this rate, and to the frustration of everyone, it will take a hundred years to issue all the titles. For heaven's sake, speed up the process and get more titles issued so owners can get mortgages to build a home on their land.

Let the debate continue on how to expand the provision of more housing solutions. It is time our people feel like stakeholders in the land of their birth.

- Delroy Chuck is an attorney at law and Member of Parliament for North East St Andrew. Email feedback to delchuck@yahoo.com and columns@gleanerjm.com