Jamaica National Building Society (JNBS) will lay off between “20 and 50” employees, the Business Observer has been reliably informed.

The staff cut is said to be part of a broad cost cutting excercise at the company which is being forced to significantly lower mortgage rates.

“The changes that the government has instituted with the stamp duty on mortgages has made the industry incredibly competitive,” a source disclosed.

“People are shopping around for mortgages and JNBS has reacted by trying to contain its cost,” the source added. “It is a question of what cash flow the company can control and labour is a fixed cost that you can manage.”

JNBS did not respond to a Business Observer query up to pres time.

Lenders in the real estate industry have been jostling to offer the most attractive rates on the market since Government’s move to adjust stamp duties. Government in April made stamp duty payable at the nominal rate of $100 when refinancing a mortgage for equal amounts or less, adjusting it from 0.7 per cent of the principal being refinanced, plus a flat fee of $500 for the power of attorney that is included.

The move prompted building societies across Jamaica to significantly reduce mortgage rates over the last quarter.

Scotia Jamaica Building Society (SJBS) cut mortgage rates by as much as 3.25 points for new homeowners — from 14 per cent to 10.75 per cent — in April. Victoria Mutual Building Society (VMBS) followed in May when it reduced its rates by two percentage points on new residential loans for owner occupied properties to 10.40 per cent for savers and 11.99 per cent for non-savers. And sources say JNBS will be making the move to drop its rates significantly from the current 13 per cent to single digits.

“Revenues will likely trend dowwards because the removal of stamp duties has made mortgages portable,” an industry insider said.

The development in the industry has some realtors predicting that the National Housing Trust (NHT) will be forced to reduce its rates as well or at least increase its loan ceiling because of the closeness between its rates and the private institutions — the private institutions generally offer more money to borrow.

NHT offers up to $1.5 million per person to purchase land and up to $4.5 million (Non-Homeowner’s Loan Limit) per person to purchase a home, at interest rates of up eight per cent.