PRIME Minister Andrew Holness on Thursday announced increases in National Housing Trust (NHT) loan limits, saying that the move is intended to improve affordability for contributors and bring the maximum benefit in closer alignment with prevailing market conditions.
"Effective July 1, 2023, the general loan limit for a single applicant will be increased to $7.5 million, up from $6.5 million — a 15 per cent increase. However, where a single contributor is buying a housing solution priced at $12 million or less, the contributor may access up to $8.5 million towards financing for that unit," Holness said in his contribution to the 2023/24 Budget Debate in Parliament.
"Two persons applying jointly will be able to access funding of up to $15 million, up from $13 million," Holness also announced, adding that the NHT will continue to provide 100 per cent financing for its scheme units, subject to the availability of funding for such purposes.
He noted that in 2022, the NHT reintroduced its policy to allow up to three contributors to co-apply for a single NHT scheme unit of two bedrooms or larger to better improve affordability.
"A key provision of this policy is that proof must be established that the applicants are bona fide family members, and have demonstrable kinship ties — for example, wives, husbands, children and siblings. In light of the proposed revised loan limits, three co-applicants will be able to access funding of up to $21 million, up from $19.5 million," the prime minister stated.
The NHT, he said, is mindful that housing construction costs, influenced in part by global supply chain issues and energy prices, have increased significantly over the past five years.
He noted that historically, the NHT has referenced developments in the housing market to inform adjustments to loan limit and interest rate structures.
"This is done periodically to improve affordability for all contributors. In 2019, the NHT loan ceiling was increased from $5.5 million to $6.5 million — an 18.2 per cent increase; interest rates for all mortgagors were reduced and the income bands were realigned.
"In keeping with the policy position that subsidies should be applied where they are most needed, a new interest rate band will be introduced, effective July 1, 2023, for persons earning over $100,001 per week at a five per cent interest rate," he said.
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