Young people seeking to purchase their first home will now have more affordable options available to them through the National Housing Trust (NHT) which will be developing one-bedroom apartment complexes, particularly within or near urban centres, as starter homes.

This initiative was among a raft of new measures for affordable housing solutions Prime Minister Andrew Holness highlighted in his budget debate presentation in the House of Representatives on Thursday.

He said the starter homes will be made available to contributors via sale agreements with an optional buy-back clause.

“The buy-back clause will give mortgagors the option to sell the property back to the NHT after a determined time. The trust may re-purchase the unit for sale to its contributors. The mortgagors who sell their unit to the NHT under this arrangement will be allowed to access a new benefit from the NHT, in full, towards the acquisition of a new home,” he said.

Holness said this model will be an attractive arrangement for single dwellers and young couples who do not wish to forfeit an NHT first-time homeowners’ benefit in order to secure stable housing.

“We are targeting young people just starting out. There are a lot of young people getting work in the BPO (business process outsourcing) sector, they are straddled with rent. They would really want to be able, instead of paying rent, to make that investment in a mortgage towards the equity in a property that they can then use to further improve their equity holding in another property,” he said.

“This is, I believe, a big move for homeownership for young people. It is a big move to incentivise construction in this area of the market… This is a big day for housing in Jamaica,” the prime minister further declared.

Holness said 264 one-bedroom units are currently under construction at Vineyard Town and Howard Avenue, St Andrew, and will be sold under this programme.

He said an additional 303 units at Barracks Road in Montego Bay are also earmarked, and will be targeted to workers in the tourism, BPO, and security sectors.

“[This] allows younger persons to enter the housing market to acquire a property, and then when they are at a better stage in life they can sell the property back to the NHT and still get access to their full benefit,” he said

Holness said the programme is also going to incentivise private developers to come into that market to build these starter home units “to get young people to invest in them, knowing that they can always come out of the property, save their equity, get their benefit and move to a better property”.

In the meantime, the prime minister said the NHT will also be altering its policy to benefit young adults below age 35 years.

“Based on the NHT’s beneficiary selection system, the longer you contribute, the greater your chance of selection for a scheme unit. Consequently, older contributors are the ones mainly selected for NHT units.

“The trust is cognisant of some of the indirect consequences of this policy, and its direct impact on specific groups — particularly contributors below the age of 35. The trust’s data suggests that this group is under-represented in scheme selections, even when factoring for other affordability and accessibility levers such as Intergenerational and Parent Assist mortgages, which take into account the points of the older applicant,” he said

The prime minister said that to address this the NHT will reserve up to 10 per cent of the housing solutions in the current housing plan for contributors under 35 years old.

“Over the next five years, this will result in approximately 4,300 housing solutions being available at 100 per cent financing up to $15 million, subject to affordability levels,” he said.

Turning to other housing initiatives, the prime minister said that the Tourism Enhancement Fund, under a partnership with the New Social Housing Programme, will provide $500 million to fund housing for tourism workers who live in substandard conditions.

Additionally, he said $15 billion will be earmarked over the next three years that will focus on the renewal/ redevelopment, of small inner-city communities. This will be done under the Housing Agency of Jamaica.

Further, he announced that, during 2024/25, the NHT is projecting to commence construction of 15,009 housing solutions with more than 96 per cent geared toward lower middle-income to low-income contributors.

“These 15,000 houses comprise 4,309 two-bedroom solutions, priced at an average below $13 million; 7,600 one-bedroom units priced at an average below $10 million and 3,100 serviced lots priced below $4 million,” he said

Holness noted as well that the NHT will complete approximately 3,744 housing solutions across the island in the upcoming financial year.