NHT benefits doubled
PM tells NHT to expedite smaller projects
Patrick Foster, Observer writer
Thursday, February 02, 2006
Almost seven months after he introduced a raft of increased National Housing Trust (NHT) benefits, Prime Minister P J Patterson yesterday announced a whopping 100 per cent hike in loan limits for contributors buying their first homes.
Effective April 1 this year, the loan limit for non-homeowners will be increased from $1.5 million to $3 million for single applicants, Patterson revealed at the launch of the NHT's 30th anniversary celebrations at Emancipation Park in New Kingston.
This substantial increase means that two persons joining to purchase a house on the open market, or in a housing scheme, or to build on their own land will be able to obtain a loan of up to $6 million from the NHT.
"At a recently held (NHT) board retreat, a thorough review of the housing benefits policies was undertaken," Patterson told guests at yesterday's function. "The proposed changes to be implemented will result in an increase in the access to housing benefits and result in greater levels of efficiency."
Patterson also revealed that the loan limits for a serviced lot and house lot will move from $600,000 to $1 million, and where there are two applicants it will be increased from $800,000 to $1.6 million.
The home improvement loan limit for a single applicant will move from $600,000 to $1 million, while two applicants will be able to borrow $2 million, up from $1.2 million.
Last July, Patterson, in an apparent bid to win Opposition support for his administration's plan to take $5 billion from the Trust to help finance an ambitious education reform programme, had announced increases in NHT loans at lower interest rates.
But the Opposition refused to back the plan, arguing instead that the government should take the money as a loan. However, the government used its parliamentary majority to pass the resolution.
Patterson's announcement yesterday did not affect interest rates and income bands that were changed last July.Under the current structure, persons earning up to $5,000 per week pay only two per cent; contributors earning up to $20,000 per week receive their loans at seven per cent; and contributors earning over $20,000 per week access their loans at eight per cent.
Yesterday, a source at the NHT confirmed that the latest loan adjustments announced by Patterson meant that a contributor would have to earn a minimum of $15,800 per week to qualify for the maximum $3 million loan.
Responding to yesterday's announcement, Dwight Nelson, president of the Jamaica Confederation of Trade Unions, said that while the increase was commendable, the issue of eligibility should be examined.
"If one examines the workforce there is quite a significant number of people who would not qualify for the benefits," Nelson told the Observer.
West Indies Home Contractors (WIHCON) spokesperson Judy Bruce described the loan increases as "an enticement" but reminded that the NHT's mandate was to provide low-income housing.
"I do feel we have a moral obligation to provide housing for people at the lower level," said Bruce, whose firm builds most of the NHT's low-income houses and starter homes, especially in the Greater Portmore area of St Catherine.
Leo Taddeo, chairman of New Era Homes, a development company that provides houses in association with the Trust, welcomed the announcement. "It is a good thing for everybody," he said. "Anybody can now own a house in Jamaica."
Yesterday, Patterson urged the Trust to enter into joint venture arrangements with recognised private developers and at the same time identify and engage small contractors to expedite smaller projects.
"The reality is, we need in the short term, approximately 30,000 housing solutions annually," Patterson said. "To attain this target, the NHT is expected to finance 12,000 housing solutions for the period 2006 to 2008 at an estimated cost of $20 billion."
He said that interest payment on mortgages would be tax-deductible, adding "I expect the minister of finance to include this feature in the budget for the next financial year."
He also announced a revision in the loan eligibility criteria, saying that the Trust has reduced from seven to three years, the requirement for applicants to account for, and pay with interest, outstanding contributions.
The Trust, he said, was looking at relaxing the rule that a contributor was entitled to only one benefit.
"Considerations are being given to two new initiatives which will benefit persons who received loans at least 15 years ago," said Patterson.
He identified those initiatives as the Home Enhancement Loan Plan (HELP), which will allow for repairs to residential properties owned by contributors and the Home Ownership By Exception (HOPE) , which will entitle contributors who have received a loan but who are no longer home owners to access another loan.
© 2000-2001 Jamaica Observer. All Rights Reserved
PM tells NHT to expedite smaller projects
Patrick Foster, Observer writer
Thursday, February 02, 2006
Almost seven months after he introduced a raft of increased National Housing Trust (NHT) benefits, Prime Minister P J Patterson yesterday announced a whopping 100 per cent hike in loan limits for contributors buying their first homes.
Effective April 1 this year, the loan limit for non-homeowners will be increased from $1.5 million to $3 million for single applicants, Patterson revealed at the launch of the NHT's 30th anniversary celebrations at Emancipation Park in New Kingston.
This substantial increase means that two persons joining to purchase a house on the open market, or in a housing scheme, or to build on their own land will be able to obtain a loan of up to $6 million from the NHT.
"At a recently held (NHT) board retreat, a thorough review of the housing benefits policies was undertaken," Patterson told guests at yesterday's function. "The proposed changes to be implemented will result in an increase in the access to housing benefits and result in greater levels of efficiency."
Patterson also revealed that the loan limits for a serviced lot and house lot will move from $600,000 to $1 million, and where there are two applicants it will be increased from $800,000 to $1.6 million.
The home improvement loan limit for a single applicant will move from $600,000 to $1 million, while two applicants will be able to borrow $2 million, up from $1.2 million.
Last July, Patterson, in an apparent bid to win Opposition support for his administration's plan to take $5 billion from the Trust to help finance an ambitious education reform programme, had announced increases in NHT loans at lower interest rates.
But the Opposition refused to back the plan, arguing instead that the government should take the money as a loan. However, the government used its parliamentary majority to pass the resolution.
Patterson's announcement yesterday did not affect interest rates and income bands that were changed last July.Under the current structure, persons earning up to $5,000 per week pay only two per cent; contributors earning up to $20,000 per week receive their loans at seven per cent; and contributors earning over $20,000 per week access their loans at eight per cent.
Yesterday, a source at the NHT confirmed that the latest loan adjustments announced by Patterson meant that a contributor would have to earn a minimum of $15,800 per week to qualify for the maximum $3 million loan.
Responding to yesterday's announcement, Dwight Nelson, president of the Jamaica Confederation of Trade Unions, said that while the increase was commendable, the issue of eligibility should be examined.
"If one examines the workforce there is quite a significant number of people who would not qualify for the benefits," Nelson told the Observer.
West Indies Home Contractors (WIHCON) spokesperson Judy Bruce described the loan increases as "an enticement" but reminded that the NHT's mandate was to provide low-income housing.
"I do feel we have a moral obligation to provide housing for people at the lower level," said Bruce, whose firm builds most of the NHT's low-income houses and starter homes, especially in the Greater Portmore area of St Catherine.
Leo Taddeo, chairman of New Era Homes, a development company that provides houses in association with the Trust, welcomed the announcement. "It is a good thing for everybody," he said. "Anybody can now own a house in Jamaica."
Yesterday, Patterson urged the Trust to enter into joint venture arrangements with recognised private developers and at the same time identify and engage small contractors to expedite smaller projects.
"The reality is, we need in the short term, approximately 30,000 housing solutions annually," Patterson said. "To attain this target, the NHT is expected to finance 12,000 housing solutions for the period 2006 to 2008 at an estimated cost of $20 billion."
He said that interest payment on mortgages would be tax-deductible, adding "I expect the minister of finance to include this feature in the budget for the next financial year."
He also announced a revision in the loan eligibility criteria, saying that the Trust has reduced from seven to three years, the requirement for applicants to account for, and pay with interest, outstanding contributions.
The Trust, he said, was looking at relaxing the rule that a contributor was entitled to only one benefit.
"Considerations are being given to two new initiatives which will benefit persons who received loans at least 15 years ago," said Patterson.
He identified those initiatives as the Home Enhancement Loan Plan (HELP), which will allow for repairs to residential properties owned by contributors and the Home Ownership By Exception (HOPE) , which will entitle contributors who have received a loan but who are no longer home owners to access another loan.
© 2000-2001 Jamaica Observer. All Rights Reserved
