Wed | May 18, 2022

Letter of the Day: Housing strategy needed for young professionals

Published:Monday | August 31, 2015 | 12:00 AM


It has been reported that the Planning Institute of Jamaica (PIOJ) recorded a fall in the number of housing starts by 56 per cent for the April to June quarter of this year. This is the clearest and latest indication that the people of Jamaica are under tremendous financial strain, despite the passing of successive IMF tests.

The colossal fall in housing starts has serious implications for many other areas of the economy. There is a direct relationship between the number of housing starts and the volume of mortgages disbursed.

Hence, it comes as no surprise that over the same period, April to June 2015, the PIOJ estimated a fall in the number of mortgages disbursed by three per cent, a trend that is likely to continue. This development is sure to catch the attention of the senior executives in the banking sector.

It will be interesting to see statistics on the performance of durable consumer goods over the next year. If housing starts fell by 56 per cent, it only follows that the demand for durable consumer goods, such as furniture and appliances, will also see a similar drop.

My humble opinion is that more of the Government's resources and energy needs to be directed towards meeting the housing demand for young professionals. Bringing the dream of home ownership to fruition for young, bright and educated people sends a clear signal that there are rewards for getting a good education and working hard. If paid properly, these same young professionals will make up the market segment that buys new homes and associated durable consumer goods.

The Statistical Institute of Jamaica reported for the April 2015 quarter that 28,300 persons in the construction industry were unemployed. Of all the industry groups measured, construction recorded the largest volume of unemployed persons.

A well-thought-out strategy for housing for young professionals has the potential to boost employment at all skill levels, not only in the construction industry, but also in real estate, banking, manufacturing and retail. While it may not solve all of Jamaica's challenges, it is clear that the implementation of a housing strategy that targets young professionals can be of benefit to all Jamaicans.