Housing Trust brings back lease-to-own option
(CNS): The National Housing Development Trust is introducing a series of new initiatives to increase the supply of affordable homes, given the challenges Caymanians now face in an over-inflated private housing market in which local people are competing with foreign billionaires looking for a sunshine home. The NHDT, which has been allocated $15 million over the next two years, will also be expanding the Home Repairs Programme and reintroducing a lease-to-own initiative for those struggling to secure mortgages.
The former PACT government had established a cross-ministerial task force to look at the developing housing crisis in Cayman, where the cost of buying or renting a home is now beyond the reach of many ordinary people. The high prices are also causing major social problems as landlords have begun renting by the bed and turning apartments into dormitories for people in the lowest-paid jobs.
The new UPM government, which took over the task force, has revealed very little about its findings or its plans to address the problems created by the lack of affordable housing.
In the meantime, the NHDT, which remains the only entity building social housing, said in a release that its immediate priority is to accelerate the construction of new homes as well as to reintroduce the lease-to-own initiative to help Caymanians who don’t qualify for mortgages with any local lending institutions. The aim of the programme is for those participants to own their homes outright after a period of five years.
The repairs programme will now include houses not built by the NHDT. In partnership with the Ministry of Social Development, the programme allows homeowners who might not otherwise be able to afford necessary repairs to maintain a dry, safe and livable environment.
“The National Housing Development Trust has to keep evolving in order to meet the needs of
our community,” Andrew McBean, chairman of the NHDT board, said in the release. “With the current shortage of affordable housing, it is imperative that the Trust innovate and adopt a more sustainable approach in the way we design and build homes, ensuring that we achieve the most efficient use of land and deliver the greatest value for money.”
The long-time general manager of the housing trust, Julio Ramos, has resigned and will be leaving later this month, the release said. As a result, the NHDT has engaged local consultants Deloitte to look at various operations within the planning and housing ministry to modernise operational frameworks and put in place new procedures to allow the organisation to scale up operations while the board recruits a new general manager.
“I’d like to take this opportunity to thank Mr Ramos for his knowledge and technical assistance over the past year during which we started the process of innovating and evolving, for his ongoing assistance with the current transition projected up to the end of his term later this month and for his dedicated service over the past 14 years,” said Mr McBean. “His legacy is a loyal and dedicated team of staff members, committed to helping to deliver on our plans for the future.”
Ramos said he was leaving to pursue other “personal aspirations” adding that it was a difficult decision. He said he had cherished his time at the NHDT and had enjoyed working with the operations team, the various boards over the years, and the government. Ramos said that his resignation may come as a surprise to some, but he has been assisting with the required transition exercise for the continued efficiency and delivery of service to Caymanians who require housing assistance and opportunities.
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Category: development, Local News
Lots of the affordable homes that Government build in the Brac went to Johnnys come lately expats, it’s a crying shame expats come here to work, gets Status then gets one of these affordable homes and when they retire sells the house and goes back to their home country.
Yet another corrupt vote buying scheme buy the UPM – basically a free place to live because you know none of them will make the payments after the first month and unlike a bank who would evict them, their MP will let them default and make a bunch of excuses.
I understand the CIG just bought a house in the Brac that was being foreclosed on. The person now rents its for a peppercorn lease of $1. Friend of Julie’s who now gets to live rent free – good plan for getting a family full of votes. #LeggeWasRight
Lease to Default would be more accurate terminology.
As in all that came before this will ultimately fail. But it will buy some votes and that is the main thing isn’t it? You can try to help those who can not help themselves but you you will just share their failure. It has always been this way and always will be this way. A couple of not hard working but intelligent ones will make a lot of money from this and might even get away with it this time but everyone else involved will lose.
The projects are coming!!!
“The aim of the programme is for those participants to own their homes outright after a period of five years.”
Cannot qualify for a mortgage but can pay for a home over five years. Please share these secrets.
Also why do they insist on building standalone homes. You can fit so many more attached or semi-detached homes.
As an loans officer, paying the mortgage back in 5 years means one of two things. 1) These people don’t need this program as they are banking serious pay to do so. 2) These be some cheap ass homes.
This has to be said wrong. I think they mean in their own home not paid off outright. Hell, I cannot pay off in 5 years with my salary today and the loan from 15 years ago what it would cost now.
Yeah has to be worded wrong. They cannot mean “outright” as in the way we think of outright.
Kenny trailer parks soon come.
Trailer trash to follow.
Trailer trash will have to get in line behind the tenement yard denizens.
“local people are competing with foreign billionaires looking for a sunshine home..”. Come on CNS, a small number of people buying multi million dollar homes are not the issue. Its not as if they are buying the same kinds of homes or in the same areas. Its simply supply and demand. According to the ESO population has grown by 28,000 in the last 10 years, and housing stock nowhere near that number. That’s why house prices and rent are going up across the board, not just in the luxury end of the market.
Rent prices have also been significantly impacted by increasing property insurance costs.
Agree. Insurance up almost 50% where I live on Grand Cayman (I’ve made no claims in 15 years). Some condos struggling to get insurance coverage
“to help Caymanians who don’t qualify for mortgages with any local lending institutions. The aim of the programme is for those participants to own their homes outright after a period of five years.”
How the hell is someone going to pay off the entire value of a home in 5 years if they don’t earn enough to qualify for a mortgage to buy it?
The only way is if the home is offered at a significant discount over its true value (to a select few people who are friends/family of those making the decision).
And then that home is sold at market value, pocketing a nice profit for the participant, and then the home is no longer ‘affordable’ to Caymanians again.
Not everyone has to be a home-owner.
The government should make affordable housing available to Caymanians by building it themselves and then renting it to them at a slightly discounted and means tested Caymanians-only rate, not giving it to them.
Otherwise the whole circus just starts over again.
because maybe they wont be paying for the home twice! When you finish paying a $365K Mtge you have paid the bank $720K. You guppies dont think. Mtge payment $3K but only $200 go to your principle how, make it make sense.
Make some shitholes for the plebs while you wallow in luxury.
What’s not to like?
I only have one question: What happens when the renter stops making rent payments?
That’s the thing. We all know what the banks would do.
The banks don’t want to repossess. They don’t want to be saddled with real estate, with costs to repair, keep, maintain and sell. That’s alongside the bad press from evicting an entitled occupant. So banks want better customers with certainty that a mortgage will be paid off. Let the government deal with programs to house the remaining aspiring home owners
That was my point. We know what the banks would have to do, what is Government’s plan when faced with the same circumstances? As well as having hairbrain ideas, they are also supposed to have a strategy to manage those risks. What is it? Raid another fund and/or the public to pay for it perhaps?
increase taxes, simple! (from their point of view).
exactly
The only how this works is if there is a limit to the time frame for lease-to-own, say 5 years, before the equity MUST be utilised to secure a regular mortgage to purchase the home. If not, the NHDT will eventually be left holding the bag for homes where the lease payments have stopped. Then the occupants will not be able to be evicted
due to MP complaints.
Lease to own is not the answer! If they don’t qualify now for a mortgage what will change in 5 years!!! This just makes it another administration’s problem.
What happens in 5 years if they have other debt, in the same job or worse??
How will NHDT administer these payments? So if someone misses a couple its okay cause they are not a bank!?
Election promises were made to put people in homes that can’t qualify for a mortgage so this is their short term fix.
Can’t wait to see who they hire to replace Ramos.
pie in the sky waffle….that ignores the economic and property market realities
there is no-one in cig or civil service with expertise or qualifications to tackle the housing crisis
if we can’t be honest and face these facts we will never be closer to a solution.
Suggestions
– Stop building single family homes that require upkeep for people that are already barely qualifying for an NHDT home.
– Build apartment blocks with common areas for children to play in and take up less land.
– Allocate a budget for public works/gov to maintain these buildings and grounds so that they don’t fall into disrepair like all of the NHDT neighborhoods.
– Offer a rent to own/lease to own scheme for these apartments with a discount on purchase price based on the tenants previous rental term.
Currently government are setting a lot of these individuals up to fail at the expense of the taxpayer. Also, engage with competent contractors as currently the prices they are offering to build the NHDT homes is way too low, so no decent contractor is accepting the contracts.
Timely given coming elections perhaps? Most seeking this option won’t get that either.
Building these homes without setting any community standards for the owners to follow will almost always lead to it becoming a ghetto. Look at the other homes they built in the past. Great initiative the intentions are good but these owners get homes and don’t value it one bit.