Housing & Urban Management in the Caribbean

Presented by Michelle Mycoo Ph.D. Department of Surveying and Land Information Programme: - Planning and Development University of the West Indies, Trinidad

POPULATION

Population Trends in the Caribbean

Small island developing states but high level of urbanization compared with Asia. 57% of the countries in the Caribbean have over 50% of their population living in urban areas. Decapitalised urbanization and widening urban fiscal gap to meet basic needs of the poor.

Figure : -Country & Percent Urban Population

Haiti Dominican Republic Dominica Bahamas Belize

Country

Trinidad & Tobago St. Vincent & Grenadines St. Lucia St. Kitts Nevis Jamaica Guyana Grenada Barbados Antigua & Barbuda

10

20

30

40

50

60

70

80

90

100

% Urban Population
Source: - World Bank Little Data Book 2000, UNCHS Human Settlement Indicator 2003, Caribbean Development Bank 2002.

POVERTY

 New concept of the working poor . In Jamaica 56% of the poor are employed If poor is disaggregated they include female household heads, elderly persons, children, mentally and physically challenged Children (49% of the poor in Jamaica are children)

Poverty Estimates for Selected Caribbean Countries

Source: -ECLAC Education and its impacts on poverty: equity or exclusion, Trinidad and Tobago, West Indies, February 2000.

Figure: - Urban Poor

Figure: - Vulnerable People

Access to Land
Structural adjustment era of the mid 1980s to mid 1990s Rolling back the frontiers of the state & era of free market economics and privatization Linked to exacerbation of poverty in Caribbean including landlessness which is a growing phenomenon In the Caribbean generally high levels of home ownership but land ownership is considerably lower.

Dysfunctional Land Market

Structure and efficiency of land market closely linked to poverty Land is a vital resource and asset in breaking inter-generational poverty

Structure of Land Market

State ownership of land High levels of state ownership of land in some Caribbean countries especially in those where forest reserves exist. State therefore has significant influence on the operations of the land market given high proportion of publicly-owned land

Table: - Land Tenure Patterns in Selected Caribbean Countries

Country Antigua & Barbuda Barbados Dominica Grenada Jamaica St. Lucia Trinidad and Tobago Belize Guyana Suriname St. Kitts & Nevis
Source: - Various

State Land Ownership% 41 1 66 10 22 38 51 45 78 33 82

Private Lands % 32 99 34 90 78 62 49 55 22 67 18

Concentration of land ownership among elite

In Trinidad, Barbados, and some territories in the Eastern Caribbean e.g. Grenada and St. Lucia there is a highly skewed pattern of land ownership and control by the elites which is inherited from colonial times. Mid 1970s less than 1% of landowners in St. Lucia controlled more than 90% of total land under cultivation. Land redistribution attempted in St. Lucia and Belize. Forced land redistribution- squatter regularization in Jamaica, Trinidad and Guyana.

Squatting
Symptom of landlessness and poverty Squatting is most marked among former and current British territories e.g. Jamaica, Trinidad, Guyana, St. Vincent and the Grenadines and Grenada. Barbados is the exception where option of squatting was highly restricted by the very small Crown estate i.e. 1% of land stock is stateowned.

Figure:- Squatting in Trinidad

Land Values
Some territories land prices in urban areas and increasingly in the peri-urban areas have spiraled making land unaffordable to the poor.

Reasons for inflated land values in Caribbean

Competition for limited land resources (fragile ecosystems, biodiversity, rugged terrain, small land masses) Inefficient land management Urbanisation, scarcity of housing plots and expatriate and non-nationals purchasing land for retirement (dismantling of legislation regulating ownership of land by foreign investors)

Response to inflation of land prices

Urban poor have continued to occupy land illegally, rural poor owns land Increase in rental of housing since poor cannot own land and build houses

Housing Policy in the Caribbean

Main Thematic Areas

Imbalance between Demand and Supply of Affordable Housing Dysfunctional land markets Housing Finance

Selected Case Studies

Trinidad and Tobago Jamaica

Figure:- Housing in Laventille Trinidad

Trinidad & Tobago

In its housing policy of 2003, GOTT stated objectives:
Provision of 10,000 housing units per annum over next 10 years; Squatter regularization and containment in the future; Housing finance; Subsidies; Provision of rental accommodation.

Figure:- Government Housing in Trinidad

Imbalance between Demand and Supply of Affordable Housing

Demand for housing increasing but shortfall in housing provision Total no. of applicants in Ministry of Housing database as of March 2006 (74,500) Based on projected prices of houses 40% of applicants cannot afford the lowest cost houses under construction 59% of applicants earn less than $4,000 per month cannot qualify for mortgage

The GOTT has attempted to: Enable public-private partnerships (jointventure programmes (JVP)) Reduce intervention in market as direct producer of new housing units

Result
Government unsuccessful in attracting private sector to provide housing for the poor i.e. houses less than US$40,000. Private sector finds that the profit margin is too small and unwilling to take risks associated with low-income housing. Developers in the JVC cannot sell houses they built because of no titles HDC cannot release US$30m. worth of housing stock to the T&T Mortgage Finance Co. Poor cannot afford land and housing and the history of cost recovery is poor.

Rental Housing
Rent Restriction Act on housing rented at December 1978 dampened incentives to invest in houses HDC subsidised rental houses at rate of US$16$56 per annum

Proposed rent-to-own option allows occupant to rent for up to 5 years with option to purchase.

Landlessness and Informal Housing

The Land Settlement Agency established to improve delivery of shelter to the most vulnerable. 47% of households have inadequate documentation of rights to the land they have built their houses. 23,000 households applied for Certificates of Comfort between 1999 and 2000.

Regularization Proposals:
Regularizing 5,400 squatter households under the 1998 State Land Act. Basic infrastructure (water, electricity, waste water disposal, basic roads, drains and public lighting). Average cost of upgraded lot, including land (199 lease), infrastructure improvements and tenure regularization cost approx. US$6,000. Simplified land regularization procedure (3 step process).

Results
Infrastructure upgraded on 6 sites Shortage of land surveyors to complete surveys Limited success in halting squatting because of limited availability of raw land and high cost of developed land.

Infrastructure & Housing Finance

Infrastructure costs are subsidized 100% under Accelerated Housing Programme. Housing finance via reduced interest rates. Under Mortgage Companies Programme commercial banks, insurance companies and other lending agencies lending at preferential rates Exempt from corporate taxes on income earned from low income mortgages for housing costing up to US $71542.00 Incentives offered to private developer are advance payment of 10% and a waiver of performance bonds.

Results
Leakage of subsides to non-target groups Limited impact in providing low-income housing

Jamaica

Imbalance between Demand and Supply of Affordable Housing

Highest demand for housing in urban areas of Jamaica, but GOJ cannot build enough to clear backlog of demand for lowincome housing Virtually all government housing units being delivered through JVP 1997 to 2000 JVP using government land produced 4,533 housing units

Dysfunctional housing market

25% of Jamaicas housing market are not eligible for a National Housing Trust Loan, 53% qualify for 2% and 4% interest. Private sector unwilling to take risk of lowincome housing provision

Landlessness and Informal housing

Programme for Resettlement and Integrated Development Enterprise better known as Operation Pride aimed to address squatting and land supply to low income groups through government intervention. Target to provide 100,000 lots to beneficiaries and upgrade 50 squatter settlements by 2000.

Results
March 2006, 14 (28%) squatter settlements upgraded 2,630 lots distributed in existing settlements and 3,253 lots distributed on greenfield sites which are state lands. Only 6% of total target met up to 2006. Land sold below true value of land and infrastructure (Heavily subsidized) ill-targeted at the poor groups. Income to receive subsidies not used as eligibility criteria National Housing Corporation Programme discontinued because of lack of financing resulting from limited cost recovery and high subsides and the lack of land. A land bank has been started acquiring 4986 hectares up to 2006.

Housing Finance
NHT (August 2005) revised interest rates and issues loans at rates of 2% to 8% Subsidy leakage suspected An array of financial institutions exist :
1. Building Societies are principal source of long term financing in the country. In 2004 accounted for 58% total mortgage financing for housing sector. NHT receives funding from salary deductions 2% from workers and 3% employees wages bill.

2.

Low income households cannot qualify for loans

Housing Finance

cont

Land and infrastructure costs in housing in Trinidad and Jamaica are not fully recovered Problem of limited scale and sustainability of programmes because of high costs.

Access to Services in Urban Areas

Water
Access to safe drinking water at national level is 90% and over with exception of Haiti and Suriname. Problems of reliability and level of service which adversely affect the poor in terms of time, inconvenience and cost.

Table: - Access to Improved Drinking Water for Various Caribbean Territories

Country or Area Antigua and Barbuda Bahamas Barbados Belize Cuba Dominica Dominican Republic Grenada Guyana Haiti Jamaica St. Kitts & Nevis St. Lucia St. Vincent & Grenadines Suriname Trinidad & Tobago Percentage of Urban Population 95 98 100 100 95 100 90 97 98 49 98 ---93 --

Sanitation
Data shows that 10 out of 16 countries in the Table have access to improved sanitation. Exceptionally high in countries dependent on fragile coastal resources as tourism product. Pollution damage to coral reefs is a major concern. Barbados, Jamaica and Bahamas. Infrastructure investment for visitor not resident population

Table: - Access to Improved Sanitation for Various Caribbean Territories (2000)

Country or Area Antigua and Barbuda Bahamas Barbados Belize Cuba Dominica Dominican Republic Grenada Guyana Haiti Jamaica St. Kitts & Nevis St. Lucia St. Vincent & Grenadines Suriname Trinidad & Tobago Percentage of Urban Population 98 100 100 71 99 86 70 96 97 50 99 ---99 --

Sources:- World Health Organization (WHO) and United Nations Childrens Fund (UNICEF), Global Water Supply and Sanitation Assessment 2000 Report and updates provided by UNICEF to the United Nations Millennium Indicator Database.

Electricity
Generally high levels of access to electricity. Illegal supplies of electricity is common among the poor. Poor also use kerosene as in St. Lucia. Dangerous to health and safety.

Access to Electricity
Country Bahamas Jamaica St. Lucia Lacking Formal Access to electricity 6% of the urban housing unit 24% of the urban housing unit 20% of the urban housing unit

Trinidad
Trinidad 95% population has access to potable water Main urban area 33% of population received regular daily water supply 75% of urban households have house tap services (Source:2000 Census) It is a legal requirement of WASA to supply stand pipe to squatter settlements and poor urban areas even if there are non-paying households to ensure public health and safety

Jamaica
Centralized systems are located in Kingston and St. Andrew, southeast St. Catherine and Montego Bay in St. James. NWC is also responsible for a number of small sewerage systems, utilizing package plants, which are associated with housing developments in various locations throughout the country. Treatment is given to secondary level for 50% of waters. For the remainder of the population, sewage disposal is accomplished via septic tanks, soak-away pits, tile fields and pit latrines.

Conclusions Drawn from Case Studies

Imbalance between Demand and Supply of Affordable Housing. Backlog unmet Dysfunctional land markets Landlessness and Informal housing
High percentage of the poor own their houses Low percentage own land Households living in unauthorized settlements have limited access to amenities.

Cont Limited Cost Recovery and Replicability

Land and infrastructure costs in low income housing in Trinidad and Jamaica are not fully recovered Problem of limited scale and sustainability of programmes because of high costs

High level State Benevolence/Paternalism in Trinidad (economic and political rationale) Where state subsiding housing for poor.

Cont

Cost of Policy Failure

Burgeoning squatter settlements Pathology of policy responses (rent control, public provision of heavily subisidised housing Leakage of subsidies to non-targeted households Cost amplified through the rest of the economy: affects savings, investments, budgetary deficits, inflation, interest rates, labour markets and labour productivity and balance of payments. Housing sector is a major loser when housing policies fail and the economy is a major loser when the housing sector fails Winners and losers