Rent-To-Own Pilot Launched Today

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Minister of Housing and Lands,??Micheal Lashley, as he delivers the feature address at the launching ceremony of the "Rent-to-Own" Programme, today at Airlie Heights, Cave Hill, St. Michael.????

Sixty three per cent of persons who make up the National Housing Corporation???s (NHC) waiting list, are not in a position to successfully attain or service a private sector mortgage, necessitating??the rent-to-own programme.

This was stated today by Acting General Manager of NHC, Lanette Napoleon Young, at the launch of the Rent-to-Own pilot programme at Airlie heights, Cave Hill, St. Michael.

Ms. Napoleon-Young lauded the Minister of Housing and Lands, Michael Lashley, for bringing a sense of energy to the NHC and the Ministry of Housing and Lands… with an urgency to complete this very important task [of] providing housing for the average Barbadian.?????

While addressing today???s ceremony, the Minister emphasised that the Rent-to-Own programme was beneficial since it offered decent housing to Barbadians.??

While outlining the issues found in some areas of the rental sector, Mr. Lashley pointed out that some persons leased a house from an individual who did not own the land on which the property was sited. In addition, he said some?? landlords also refused to allow tenants to make any substantial improvements to the dwellings and there were too many informal rental contracts.

According to the Minister ???other issues involve the actual physical conditions of rental housing which sometimes include the absence of water, unsanitary conditions, poor maintenance, leaking roofs, rotten floors and a lack of electricity in some cases and overloaded circuits in others, which could become fire hazards.???????????

The Housing and Lands Minister also revealed that they were reports of shared utilities, poor ventilation and exploitation of low-income families, in respect to the amounts to be paid for rental accommodation.??

???Some have converted their garages into rooms and tenants are given deadlines as to when to come and go.?? There is also now evidence of people renting day and night rooms so that several persons occupy the same room,??? Minister Lashley revealed.??

The Rent-to-Own pilot, approved by Cabinet on March 19, was created to enable low-income earners the opportunity to become property owners and is based on the Trinidad model, but with modifications.??

To qualify, persons must not be working for more than $3,000 per month and be financially unable to service a mortgage. They must not own property elsewhere and must be first-time homeowners who have not benefited previously from any public sector housing programme.??

According to the Minister, the tenant must enter into an initial agreement for a minimum period of seven years, deposit two months rent, representing a security deposit, and then make monthly payments equal to 30 percent of income as rent for a period of seven years, in the first instance.??

???During the first seven-year period, payment will be distributed 70/30 ??? 70 percent of the rent being credited to the purchase amount and 30 percent going towards the landlord to cover maintenance, insurance, and any other special charges. If the tenant cannot afford to purchase after seven years, Government, with a social conscience [will allow] the agreement [to] be extended for a further two years, with a modified 60/40 ratio distribution of monthly payments.?? This arrangement will continue until the full purchase price is paid,??? he explained.??

The Minister also outlined that the security deposit would be credited towards the purchase price and at any stage during the period, the tenant could pay a higher monthly payment. If the tenant dies at any time during the period, a personal representative or beneficiary could continue the tenancy, once all other requirements were met.?? If the tenant is unable to maintain the tenancy, the tenant will be referred for an alternative housing solution at the NHC.

The Minister also disclosed that the NHC had instituted a special desk to manage the programme and outlined the benefits as ???enabling persons who would not otherwise qualify for assistance at market rates to become homeowners… It engenders a sense of pride and achievement in the tenant, with the knowledge that at the end of the process, the property will be theirs,??? he stated.??

Keys were also presented by the Minister to the first two tenants, Adrian Sealy at Lot One and Sadiq Hill at Lot Nine.?? Airlie Heights is a development of 16 two-bedroom duplex units.

lbayley@barbados.gov.bb

 

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