Gov’t Looking at Measures to Make Home Ownership Easier
Prime Minister, the Most Hon. Andrew Holness, says the Government is looking at a raft of measures to improve the real estate market and make home ownership easier for Jamaicans.
These include introducing more liquidity into the market to further reduce credit rates, and growing the secondary and reverse mortgage markets.
Mr. Holness, who was addressing a Realtors Association of Jamaica (RAJ) symposium at Spanish Court Hotel in New Kingston on October 12, informed that policy analysis has started to strengthen the secondary mortgage markets.
This will provide greater access to mortgage financing and reduce mortgage rates resulting from increased competition.
“People who hold mortgages can readily find markets to on-lend. That will have an effect, ultimately, on mortgage rates, bringing them down,” he pointed out.
A secondary mortgage market is one where home loans and servicing rights are bought and sold between lenders and investors. This type of market is extremely large and liquid.
Mr. Holness said the policy to be developed will address the risks associated with these kinds of mortgages. He noted that existing models of secondary mortgages are being analysed with a view to adoption in the “not-too-distant future”.
As it relates to reverse mortgages, Mr. Holness said work is under way to look at its possible inclusion in the local mortgage system.
Reverse mortgage or home equity conversion mortgage is a type of home loan for older homeowners (62 years or older) that requires no monthly mortgage payments. Borrowers are still responsible for property taxes and homeowner’s insurance.
The Prime Minister noted that it would take some time to develop such a system, but noted that policy to initiate it is being examined.
Meanwhile, Mr. Holness indicated that drafting instructions have been issued to the Minister without Portfolio in the Ministry of Economic Growth and Job Creation, Hon. Dr. Horace Chang, for the establishment of a Townhouse Act.
“This is such an important piece of legislation to bring order to developments and to preserve the value of people’s real estate investment that it should be fast-tracked,” he pointed out.
He also indicated the need to streamline operations within the real estate sector, including merging some entities to improve efficiencies.
State Minister in the Finance and the Public Service Ministry, Hon. Fayval Williams, who also addressed the seminar, informed that the Ministry will be engaging with representatives from New
Zealand to examine the speedier registration of property titles.
New Zealand is highly ranked for its ease, speed and low cost in registering titles.
“We’re beginning those conversations to understand the systems in place, what they do and how we can duplicate those systems,” Mrs. Williams pointed out.
She noted that draft legislation is being finalised to amend the Registration of Titles, Cadastral Mapping and Tenure Clarification (Special Provisions) Act in order to reduce land disputes.
It will also strengthen the work of adjudication committees that settle land matters.
The symposium, held under the theme ‘Making Real Estate Transactions Easy’, formed part of the RAJ’s 50th anniversary celebrations.
The event brought together stakeholders in the industry in order to make the sale of property more seamless and hassle-free. It examined a range of topics such as expediting loans and the speedy processing of real estate transactions.
With more than 700 active members, the RAJ works to improve the administration of the practice of real estate, promote ethical conduct among practitioners and provide continued educational opportunities.