The State’s Public-Private Partnership (PPP) initiative has crossed the billion dollar mark in just under three years.
The Housing Development Corporation (HDC) confirmed this figure in an interview with Guardian Media on Monday.
“At present, there are over $1 billion dollars in PPP contracts at this time. This is a noteworthy and very important aspect and shows that local and foreign contractors are willing to partner with the Government to achieve its housing mandate,” HDC corporate communications manager Dike Noel said.
The figure includes the recently completed development at Mahogany Court, Mt Hope and another one at Bamboo Creek Villas at Cunupia, which is expected to provide 201 townhouses and single family units. There are also developments at Trestrail in D’Abadie with 98 townhouse units, Riverside East in Corinth with 54 single family units and Siparia Old Road in Fyzabad with 72 single family and townhouse units.
“Construction on all these developments are progressing quite well. In fact, at Trestrail, one of our contractors has also recently completed twenty (20) units within budget and on schedule. In May, the HDC signed a contract with a Chinese company, China Gezhouba Group International Engineering Co Ltd (popularly known as CGGC), to construct 5,000 apartment units at specific sites across Trinidad. The first phase of this collaboration with CGGC is expected to produce 204 two and three-bedroom apartment units at South Quay, Port-of-Spain and 235 two and three-bedroom apartment units at Lady Hailes Avenue, San Fernando,” Noel explained.
He could not, however, say how much these homes would cost on completion to client who have applied for HDC housing.
“The final selling price is determined by using the construction cost of the unit plus an added component of the land cost. The final decision on the selling price is normally made by Cabinet,” he said.
The introduction of a foreign firm to finance and build houses, however, has raised questions about which income bracket of citizen would be able to afford these HDC homes.
But Noel said that there were “many developments which cater to low and lower-middle-income earners on the public housing database.”
“The provision of the revised mortgage rates (two per cent and five per cent) provided by the Trinidad and Tobago Mortgage Finance Company Limited (TTMF) and other financial institutions also assist with the affordable housing initiative,” he said.
“It can also be noted that the HDC also dedicates a specific number of housing units in each development for rental arrangements. Of note, is Vieux Fort where two buildings (68 units) have been allocated for rental.”
He did not provide the rental figures.
But the former head of the Joint Consultative Council, Afra Raymond, is questioning whose income brackets these new developments will satisfy.
In an interview with Guardian Media, Raymond said more than 85 per cent of the current HDC applicants would not be able to afford the new State houses.
“The subsidisation of public housing via the HDC has changed and one could say even reduced, but it certainly continues with the current PPP (Public Private Partnership) programme, which, as usual, does not count the value of the public property which is used for these new housing projects - ie the land,” he said in an email.
“There has been a profound shift away from the provision of affordable housing, with a high proportion of new HDC homes being sold at the same time as over 85 per cent of the applicants on the HDC waiting-list simply cannot qualify for a mortgage, even on the most favourable terms.”
Raymond said, however, that the PPP can offer “some interesting gains” and cited the recent HDC agreements with NH International at Mahogany Court and CGGC, in which no public money is spent to build the new homes.
“That said, the overarching issue is the extent to which poor people are being housed by these new arrangements. From what I can see, there is no room for the poor in these new schemes. Until we can see approaches with new homes under $500,000 in cost and 85 per cent of those new homes being permanently rented, these efforts are merely fortifying the middle-class and ignoring the poor,” Raymond said.
But the PPP is not the only avenue to access houses, as according to the Ministry of Housing lower-income buyers can access cheaper homes through other government-funded initiatives.
In a response to questions by Guardian Media on Monday, the Ministry of Housing said the Aided Self Help Housing Programme was an avenue to assist persons in managing the construction of their homes with the State providing financial and technical support.
“The programme complements the Accelerated Housing Programme and targets resident citizens with and without land. The programme is being implemented in phases to allow for effective monitoring and evaluation, with a view to ensuring that the objectives of the programme are being realised. The first phase undertaken in fiscal 2017/2018 offered approximately 1,000 developed lots in the Central area (Carapichaima, Chaguanas, Cunupia, Waterloo, Couva and Carlsen Field),” the Ministry of Housing said.
According to the Housing Ministry, there were 5,000 applicants and “700 were selected with approximately 500 approved, based on their financial qualification, to continue in the programme.”
“The programme has been allocated $2.5 million for fiscal 2019,” the ministry added.
Another low-income housing initiative is the Housing and Village Improvement Programme, it said.
“The Housing and Village Improvement Programme has been implemented by the Land Settlement Agency (LSA) on behalf of the Ministry of Housing and Urban Development. This programme utilises the Aided Self-Help approach with the objective of targeting residents of disadvantaged villages, through the provision of housing and village improvement solutions. The villages selected are based on social surveys conducted by the LSA,” the Housing Ministry said.
“In fiscal 2017/2018, the Merikins community at Samuel Cooper Road, Moruga, was selected. This project positively impacted and improved the lives of at least 54 families living in the community of Samuel Cooper Road through the construction of 30 new two-bedroom homes and home repairs carried out on 10 additional existing homes by the state, with sweat equity provided by the residents. There was also remedial work done on the drainage system in the village (construction of box drains).
“It is expected that approximately 100 families will benefit from the second phase of this project which has already begun in various communities throughout the country.”
Central Bank figures
In January 2019, the Central Bank published its Economic Bulletin and according to that report, despite a low-interest rate environment and “substantial competition among banks,” the November 2018 figures were worse than six months prior.
In June 2018, the residential real estate mortgage figure stood at 8.9 per cent and contracted to 8.2 per cent in November.
“Residential real estate-mortgage loans grew in November (5.2 per cent) somewhat slower than in June 2018 (6.7 per cent), while commercial real estate mortgages expanded (14.7 per cent) in November, up from 13.7 per cent in June 2018. Interest rates on new residential real estate mortgages were more or less stable at 4.8 per cent in the third quarter of 2018 compared to 4.9 per cent in the second,’ the Central Bank said.
PROJECTS YIELD AND TYPE CONTRACT PRICE
Mahogany Court, Mt Hope 160 apartments $192,040,419
Bamboo Creek Villas, Cunupia 201 townhouse & single family units $256,250,000
Siparia Old Road, Fyzabad 72 single family units $84,655,582.20
Trestrail, D’Abadie – 5 Packages 98 townhouse units $77,243,848.80
Riverside East, Corinth B, San Fernando – Pk1 and Pk 253 townhouse units $24,535,331.44
South Quay, Port-of-Spain 204 apartments $246,797, 585.60
Lady Hailes, San Fernando 235 apartments $241,030,402.40
Total Yield: 1023 $1,122,553,169.44
Lake View, La Fortune, Point Fortin
Single Family Units (SFUs)
Townhouses (TH)
Single Family Units, 2 bd: $271,000
Single Family Units, 3 bd: $299,300
Townhouses: $346,060
Cashew Gardens, Carlsen Field
Single Family Units (SFUs)
Townhouses (TH)
SFU, 2bd: $450,000
SFU, 3bd: $525,000
TH:$575,000
Eden Gardens, Freeport
Single Family Units (SFUs)
Townhouses (TH)
$564,000
$460,000-$575,000
Cypress Hills
Townhouses
Apartments
TH:$609-650,000
350-470,000
Buen Intento, Princes Town
Single Family Units (SFUs)
SFU, 2bd: $450,000
SFU, 3bd: $550,000
Gomez Trace, Moruga
Single Family Units (SFUs)
SFU, 2bd: $450,000
SFU, 3 bd: $625,000
Vieux Fort, St. James
Apartments
$650,000
Nepuyo Court, Malabar
Townhouses (TH)
$550,000-$570,000
Bon Air North, Ridge View Heights
Townhouse (TH)
Apartments (A)
TH: $570,000
Bon Air South, WoodStar Villas
Townhouses (TH)
$650-675,000
Carina Gardens, Arima
Single Family Units (SFUs)
Townhouses (TH)
SFU, 2 bd: $470,000
SFU,3 bd: $585,000
TH: $650-670,000
Riverside, Corinth
Townhouses (TH)
$650,000-$670,000