Steep housing price a barrier to young ambition's ladder

By Giovanni Dennis

Young Professionals in Jamaica continue to find it difficult to purchase homes in the capital, Kingston.

The housing demand is driving prices further out of reach even when they collaborate with a spouse or relative to help make a purchase.

Roughly 10 thousand students graduate from Jamaica’s top four universities annually. 

The majority of graduates are young professionals, like Lauren, who after finding a job; aspire to buy into one of the many apartment complexes now being built in Kingston: “There has been some in the Waterloo area that I’ve seen that’s pretty decent you know, they’re pretty.”

Pretty on the eyes, but also pretty costly. The average price of a two-bedroom apartment jumped from $28 million three years ago, to more than $40 million today, on average. 

I’m currently standing at 7 Devon Road in Kingston just across the road from where the Halo Luxury Apartments will be. Construction is still underway. It’s the dream of many young professionals to be able to own something like this but the cost is prohibitive.

Prices at the HALO complex range from $40 million for a one-bedroom to $50 million for a two bedroom apartment.

Lauren is realistic. There are apartments she likes but won’t seek out.

“Hearing the prices kinda deter you from wanting to try. When you compare your basic salary to what it would be to acquire a home, it’s kinda a turn off, I would say.”

Other young professionals feel the same way. I met Brianna and Michael at Devon House, stone’s throw away from the Halo Complex.

“My salary isn’t high enough to try and get a house any time soon even with a partner. It feels very difficult as well as getting a mortgage. Like, just for something in the 30 mills (million), I’d be having to pay like 200k or more, depending on the deposit. And it feels impossible. That alone is more than my salary,” she said dolefully.

Higher echelon

Michael is clear in his mind that these developments “mainly cater to persons who are of the higher echelon in terms of income and they tend to buy these houses and then hold on to them.

“So the regular professional just coming in, they don't have the income to buy the house straight out. It causes a lot of people to feel like there is no chance of us in Jamaica as young professionals to earn enough to be able to own a home and escape renting.”

The government has admitted that there is a housing crisis. A national housing needs assessment showed that Jamaica has to build 15 thousand new units annually to keep up with demand from its growing population. But only about eleven thousand new units are being built.

NHT

The National Housing Trust [NHT], which was established to make home ownership easier and more affordable, provides loans to first-time homeowners.

Six and a half million Jamaican dollars, is the maximum a single contributor can borrow from the Trust. The people we spoke to do not think that is enough.

Even after partnering with somebody, you’d have to take out an additional loan,” Laren said of the NHT facility.

“And Even after that  you’d have to go seek financial assistance somewhere else. So I think there is more to be done and more can be done,” she insisted.

Demand and Supply

Realtor Winroy Williams said as long as the demand continues to outstrip supply, prices will continue to rise. 

“Demand is great but to add to that, the cost of construction, the cost of labour, the cost of all the input into the final product. Now is this justified? I’m not so sure it’s justified. But the fact is, prices are what they are,” Williams observed philosophically.

He believes young professionals need to start approaching home ownership differently: “One, do what you can with what you have. If it means you had an idea to buy a two bedroom, one bath in Kingston, and based on that price, you cannot reach that price, one option, partner with somebody. That’s one way. Another way, buy where the money affords you to buy.”

In April 2024, the Prime Minister announced a revised first-step housing programme to address the housing crisis.

The National Housing Trust will be building one-bedroom apartments in or near urban centres, specially as starter homes for young professionals. People like Lauren, Brianna and Michael, may be finally able to buy one of the 11 thousand housing units coming onto the market every year.