GIS NEWS FEATURE
Thursday, September 27, 2001 -- With close to a whopping EC$50 million earmarked for housing development over the next few years, Saint Lucia’s already buoyant home building industry looks poised for an even busier future.
The impetus is a government-led initiative targeting the low-income segment of the market where the need for affordable housing and housing lots is greatest. Financing is through a $25 million soft loan from the Caribbean Development Bank (CDB) and a $20 million Bank of Saint Lucia bond issue.
“This is the first time that so much money is being made available to the housing sector in one tranche,” Prime Minister, Hon. Dr. Kenny D. Anthony, pointed out when Parliament authorized the CDB loan earlier this year. “Never before has so much money become available to any government in Saint Lucia for housing purposes,” he stressed.
Coming on stream at a time when the Saint Lucian economy is slowing due to a downturn in the global economy and other external pressures, especially the recent terrorist attacks on America, the intensified housing thrust is sure to have a favourable economic impact, especially on employment.
“We will be initiating housing activities across the length and breadth of Saint Lucia,” Housing Minister, Hon. Dr. Walter Francois, announced in Parliament during debate on the CDB loan. “The Government of Saint Lucia is aiming to enhance housing conditions for all Saint Lucians by providing serviced lots, redeveloping areas known as slums, and embarking upon subdivisions in other areas.”
Under the ambitious programme which Dr. Anthony said represents “an assault to resolve the problems of housing in Saint Lucia”, Government is aiming to build between 500 and 1,000 houses over the next three years. Additionally, at least 400 fully-serviced lots are to be developed for purchase and more than 350 existing homes are to benefit from major repairs and improvements.
Squatting on Crown lands is a widespread social problem in Saint Lucia. It has resulted in several unplanned developments or slum communities around the island. To improve the quality of life for such residents, Government is planning over the coming year to spend $5 million of the CDB financing, along with almost $1 million of its own resources, to tackle the squatting problem and improve living conditions.
Under a landmark initiative called PROUD – acronym for Programme for the Rationalization of Unplanned Developments, hundreds of squatters will be given an opportunity to purchase the spot on which they live. In cases where the present places of abode are considered unsuitable, residents will be relocated to a new site where the option to purchase will also be made available. Under PROUD, conditions in slum communities will be upgraded through the provision of basic amenities including roads, drains, pipe-borne water, and electricity.
Promoting land and home ownership is a high priority in Government’s strategy to empower Saint Lucians and improve their quality of life. As Dr. Francois put it, “The ownership of a house gives the occupant a sense of belonging. They feel empowered to know that this little spot in the world is theirs.”
This goal is reflected in several initiatives taken by the Administration of Prime Minister Anthony since taking office four years ago. Among them, the creation of a Ministry of Housing to develop and implement a strategic vision for the sector, the establishment of a National Housing Corporation to execute Government’s housing thrust, and the resuscitation of the low-income home building and housing lots development programme which was at a virtual standstill four years ago. These measures have helped to create the enabling environment which has made the housing sector ready for take-off.
Government is encouraging the active involvement of the private sector in its housing thrust. As an incentive to low income consumers who build their own home, Government is offering duty free concessions on building materials for a house costing less than $90,000. This benefit applies to households with a total monthly income of less than $2,400. In addition, private contractors who mostly cater to the middle and upper income segments of the housing market, can now claim duty free concessions as long as they construct at least five homes in any housing development.
To further support its housing thrust, Government has secured a reduction in mortgage rates from some commercial banks and has got the Saint Lucia Mortgage Finance Company to reduce the downpayment on mortgages from 10 to five per cent. Government is also lobbying lawyers to consider reducing their fees in another move to bring down housing costs.
Against the backdrop of steadily rising real estate prices, Government is particularly keen to see young Saint Lucians seize available opportunities to become property owners. “Avoid the temptation of purchasing cars,” is the message Prime Minister Anthony keeps driving home to young people. “Use the opportunities provided by this Government to buy land or a house.” With this in mind, Government has introduced an annual income tax allowance of up to $6,000 which can be claimed by any young person who uses an approved scheme with a bank to save towards eventual purchase of land or a home.
Taking residential building approvals as an accurate gauge of the performance of the housing sector, Government’s initiatives are clearly carrying forward its housing goal. Last year, for example, there were 475 residential approvals, up from 382 in 1999. Also in 2000, the Housing and Urban Development Corporation (HUDC), which has been merged into the new National Housing Corporation, spent $7.3 million on various projects, an increase of $3.4 million over the 1999 figure. HUDC’S expenditure was $4.58 million four years ago.
Since 1997, HUDC has completed major
housing projects at Hewanorra Orchard in Vieux Fort and at Beausejour in Gros
Islet, where more development is currently taking place under phase two. In
addition, lots were made available at Union and off the Millennium Highway.
This momentum looks set to continue as Government’s housing thrust moves into high gear over the next few years.