In a proposal put forward in its 2016 publication “An Assessment of the National Housing Trust,” the Caribbean Policy Research Institute (CaPRI) posits that adequate housing needs could be addressed if the NHT were to enter the rental arena.

The NHT should broaden its housing market interventions to include housing rental, says CaPRI, as this could benefit even its poorest contributors who are now without access to the Trust’s products.

Realistically, CaPRI says, owning a house is not the best option for some contributors. It suggests that subsidising rentals would allow the poor to enjoy decent housing which they would otherwise be unable to afford:

“The greatest need for these households is housing, not home ownership. Therefore, the key to providing housing for low-income earners is recognising that the concept of ‘housing’ is more than just providing a house.”

So far, the Jamaica Observer has received no response to queries it sent to the NHT in mid-March as to whether any consideration is being given to this latest recommendation by CaPRI. According to the NHT communications department, an answer has been prepared, but is not yet available for sharing.

CaPRI is proposing that rental housing could be facilitated by the issuing of rental vouchers to subsidise housing for those who are unable to purchase.

The policy institute makes its proposal based on restrictions on the ownership of land, among other factors. Also under consideration is the inadequacy of solutions provided historically by the NHT.

The NHT has built more than 94,000 houses, and remains the majority contributor of houses to the formal sector.

However, CaPRI points out that with the ratio of “houses built to population size” used to assess the population coverage of NHT houses, the analysis shows that the NHT has not increased its housing coverage of the Jamaican population significantly, as house completions fluctuated around 0.1 per cent of the population between 1998 and 2014.

The analysis also shows a decreasing trend over the period, CaPRI says, additionally giving the NHT a failing grade in the provision of mortgages.

The performance of the NHT, in terms of mortgage disbursement, is first assessed using the ratio of “mortgages to population size”.

Mortgages disbursed annually by the NHT fluctuated between two per cent and three per cent from 2000 to 2014, showing no increase in the share of the population that accesses mortgages.

In comparing Jamaica with other countries in the Caribbean, CaPRI said the value of Jamaica’s mortgage disbursement lags woefully behind other CARICOM countries. Jamaica ranks last in the region, with the value of mortgages being nine percentage points behind the country ranked second to last – Trinidad and Tobago – in 2012.

In advocating a housing solution categorised as rental, CaPRI said, “What is important about housing is not so much what it is, as what it does for people’s lives.

“Housing is a combination of services, which involves the choice of where to live (size and quality of property, neighbourhood, proximity, quality of financial investment) and available resources.

“There is no universally accepted type of housing; rather, the ‘ideal’ house/home is dependent on preferences, household income, family composition and needs. The definition of housing as home ownership can therefore reduce the flexibility of the market in meeting the actual housing demands, as well as exceed the needs of the householders.”

CaPRI notes that in Jamaica, 62 per cent of households own their own home, but the house may not be adequate for dwelling.

CaPRI adds that although the NHT has diversified its mix of housing solutions by including serviced lots and starter-plus homes (one-room units with basic amenities targeted to the poor), the former category does not include a house, and the latter requires contributors to own their own land and possess formal documentation.

“…Rental housing is a good solution for low-income earners, as it averts the need for land ownership, and allows households to make other investments such as in education, health care etc.”

CaPRI notes that evidence of the success of using rental housing to provide adequate solutions for lower and middle-income groups can be seen in neighbouring Latin American countries, such as El Salvador.

“The benefits of renting include the efficient use of urban space, the ability to house the labour force closer to areas of employment, and averting the upfront costs and financial exposure associated with acquiring one’s own home and a mortgage – something which is often impossible for lower-income groups.”