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JIS News

The dream of owning a home is now a reality for a significantly larger number of persons, since the National Housing Trust (NHT) revised its lending policies earlier this year, to make it more affordable and accessible to buy a house.
Since the implementation of the new measures, the NHT is reporting a 53.6 per cent increase in open market loans granted for May, June and July, when compared to the similar period last year.
“We see where persons are now able to afford more. So, this increased affordability has certainly caused an increase in the number of persons who visit us, the number of persons who call us, and the number of loan applications,” Manager for the Kingston and St. Andrew Branch of the NHT, Allison Beaumont Smith, tells JIS News.
She explains that the increase in the NHT’s loan limit, coupled with the decrease in interest rates, stimulated interest in the open market facility and resulted in the higher number of loans that were granted.
In April, Prime Minister, Hon. Bruce Golding announced the new measures in Parliament. At that time, he said that as of May 1, mortgage rates would be reduced by one per cent across all four income bands, and that the maximum mortgage loans allowable would also be increased.
This increase in the loan ceiling saw open market purchases and build-on-own land moving from $3.5 million to $4.5 million; serviced lots moving from $1.2 million to $1.5 million; construction loans from $2.3 million to $3 million; and home improvement loans from $1.2 million to $1.5 million.
In addition to the increased loans approved for purchases on the open market, the increased moratorium on build-on-own land loans and construction loans, also helped more persons to access their benefit from the NHT.
The moratorium was extended to 12 months instead of six, and Mrs. Beaumont Smith says this was reflected in the average 14 per cent increase in such loans accessed during the three-month period, when compared to the similar period last year.
She tells JIS News that the Developers’ Incentive Programme, which aims to encourage private developers to build affordable houses for NHT beneficiaries, is also being pursued aggressively by the Trust. The programme saw the interest rate charged on interim construction loans reduced from eight per cent to three per cent in relation to two-bedroom units delivered at a cost not exceeding $5.5 million and studio units not exceeding $3 million.
Mrs. Beaumont Smith says the NHT has invited developers in and introduced them to the policy, with several indicating plans to make use of the facility.
Among the other measures which have accounted for the increased interest in NHT home loans are: a no-deposit facility, whereby applicants for scheme units are no longer required to pay the five per cent downpayment on a house; and a subsidy programme under which the NHT allocates 40 per cent of its pre-tax surplus at the end of each quarter to provide subsidies to selected mortgage applicants.
There is also a Deferred Mortgage arrangement, whereby applicants can qualify for a mortgage equivalent to 60 per cent of the price of the house. The remaining 40 per cent is then converted into a deferred mortgage to be repaid or refinanced at scheduled stages in the life of the first mortgage.
Addressing concerns regarding any possible negative effect the new policies could have on the cash flow of the NHT and its long-tern viability, Mrs. Beaumont Smith says this issue was a central consideration.
“When we are planning for these special benefits and when we are developing our policies, the viability of the NHT is always taken into consideration. The management of the Fund would never take decisions that will affect the viability,” she notes.
She says implementation of the policies was smooth and that systems have been put in place to ensure that the NHT’s staff can deal with the pressure from increased interest in the Trust’s loan facilities.
The Manager informs that the NHT has also stepped up its efforts to inform contributors of its products. She says in addition to information disseminated through the media, the various branches have conducted various forums and exhibitions to market the products to contributors.
She is also encouraging contributors to reach out to the NHT and seek to inform themselves of how they can go about purchasing their homes. She says a first step is going into any branch of the NHT and finding out the loan amount to which they are eligible.
“Once you know how much you are eligible for, you go out and seek a unit within that price rage,” she advises. She says the NHT will then present the applicant with the checklist of things required before a loan interview is conducted.
Mrs. Beaumont Smith says even though it may “sound overwhelming,” if applicants inform themselves and follow the steps, homeownership can be very easy.
Contributors can call the NHT’s Head Office at 929-6500-9 or visit any of the branches of the NHT to begin their quest towards homeownership. For further information persons can also visit the NHT’s website at: www.nht.gov.jm.
She notes that even in cases where persons call to make enquiries, the NHT will follow up on these calls to see whether the customer has identified a unit for purchase or if they are still interested in buying one.
“Once we know that there is some interest, we follow up and get you even more interested. So, we anticipate that the stimulated demand and the stimulated interest will continue for some time,” adds Mrs. Beaumont Smith.
The NHT was established in 1976 with the mandate of increasing and enhancing the stock of available housing in Jamaica as well as providing financial assistance to its most needy contributors who wish to build, buy or repair their homes.

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