While Barbados’ property market continues to expand on the back of foreign investment and high-end development, Housing Minister Chris Gibbs has outlined a multi-pronged strategy to widen access to affordable housing, warning that young and middle-income Barbadians risk being priced out without targeted intervention.
Gibbs told Barbados TODAY that the government would provide a series of strategic interventions to increase the stock of affordable housing, acknowledging the significant hurdles currently facing first-time buyers and middle-income earners.
President of the Barbados Estate Agents and Valuers Association (BEAVA), Chris Hassell, has described the island as a “clear” seller’s market, fuelled by the ongoing legacy of the Welcome Stamp programme, the country’s successful removal from various international financial watchlists, and a stable political and economic situation.
While Hassell highlighted that there is “real” scope for developers to target the $250 000 to $500 000 price range, he noted that inventory at this level remains limited.
Gibbs conceded that the current landscape presents a “loaded” challenge for young professionals and first-time buyers who are struggling to find a foothold in the market: “The truth is, our young people are seeing a market where the prices seem out of reach.
“I can remember my dad bought his first piece of land for $18 000. Our young people today would be asking, ‘In what universe?’ The ministry has to play a role in allowing our young people to participate in what they see as a booming economy, and it is our responsibility to make sure that they can also take part in the tremendous growth that we are seeing in the country.”
The housing minister identified the proliferation of short-term rentals, such as those listed on Airbnb, as a significant factor tightening the supply of long-term housing. He noted that even in his own neighbourhood, many properties have transitioned into the short-term rental market to take advantage of higher revenue yields.
To counter this and address the growing demand, the ministry is currently mining data from approximately 7 000 internal records to better understand the specific needs of the population and create a more targeted approach, he said.
Central to the government’s response is an industrialised approach to construction. It is seeking to implement new building technologies, including steel-frame construction methods sourced from South America, which promise to accelerate development timelines and reduce costs.
“We are looking to obviously increase the supply of affordable homes using technologies such as steel-frame technology,” Gibbs explained. “We are also engaged in a number of joint ventures so that we can find partnerships where we can build large-scale developments faster.”
Beyond construction methods, the ministry is focusing on the financial barriers that stall home ownership. The housing minister emphasised that the time taken to process mortgages and the inability of some citizens to qualify for them are critical bottlenecks.
“A lot of people do not have an appetite for risk, so we are looking at ways of de-risking mortgages as well, so that more people can qualify for 100 per cent mortgages,” he stated. “In essence, the key is getting mortgages activated quickly. The Ministry of Housing, the Ministry of Finance, and the prime minister are all working on that aspect of it so that when a developer puts out capital, the time for it to come back is shortened.”
The government also plans to introduce a formal social housing policy, which will mandate that a specific percentage of all new developments be subsidised to serve the “sweet spot” of the market—homes priced between $100 000 and $200 000. This policy is designed to ensure that the most vulnerable, as well as those looking to get “off the hump,” can participate in the property market.
Furthermore, the ministry aims to transfer expertise to builders, ensuring that the “housing revolution” creates long-term value for the construction industry, according to Gibbs. “Whatever partnerships we engage in to bring technologies here, we will most certainly be transferring that knowledge to Barbadians as well,”he added. “If anybody is desirous of building a factory here that can print homes—because that is where it is going—we will have that expertise transferred here.”
The strategy is described as “all-encompassing”, looking not only at immediate housing needs but also at long-term wealth generation. The ministry intends to assist citizens in putting away savings into interest-bearing accounts over 15 to 20-year periods, a concept the minister refers to as “land to legacy”. This approach aims to support young professionals who face a different economic landscape than their parents.
“We are also going to engage in a social housing policy where we are going to have a certain percentage of all developments which we know will have to be somewhat subsidised,” Gibbs noted. “That is a substantial market. According to our data, we have about 7 000 data points within the ministry that we are actually mining right now to be able to see what people want, and that is a key—we are not working just with the ministry; we actually know what people want and so we will be engaging in a social housing policy as well, not forgetting the most vulnerable in our society.”
(RR)
