The Tribune

A well-known real estate broker has urged the country to tackle the growing problem of housing affordability, warning that too many Bahamians are being priced out of the mid-range market.

"Home ownership has been shown to be the foundation of safer, healthier communities," said Mario Carey, a four-decade real estate veteran. While luxury properties continue to command high prices, and he and his colleagues enjoy sustained success in this area, he worries that too many Bahamians are being priced out of the middle range housing market.

"What is happening in The Bahamas is that the high cost of real estate combined with the scarcity of high-paying jobs is creating a growing gap between those who can own their own home and those, including well-educated college graduates, who are forced to stall or forego their dream of a home of their own," said Mr Carey, founder and president of Better Homes and Gardens Real Estate MCR Bahamas Group. "We must find a solution."

He views the Bahamian housing dilemma as part of a larger set of financial challenges that, left to reverberate throughout the economy, could shatter the increasingly fragile middle-class safety net that holds communities together and allows for economic expansion.

"At the moment we are facing the perfect storm of a middle-income pocketbook punching bag," he said. "How can the median-income Bahamian household keep up with inflation, with the rising cost of living, plus 12 percent VAT, a lack of capital in the business community meaning not a lot of new businesses opening offering opportunity, double digit unemployment and little diversity in housing inventory?"

Noting that those displaced by Hurricane Dorian have merely added to New Providence's housing pressures, Mr Carey added: "When demand outpaces supply, you have to innovate to design and manufacture the supply part of the chain. I believe there are several options, including government spurring the economy by covering costs to develop subdivided crown land."

Careful zoning and development, he said, can open up vast areas for residential ownership. While government bears the first cost, owners then pay utilities, real property tax, hire service personnel or companies, and buy everything for their homes from paint to furniture. "With government's initial investment, we can create communities with parks, jogging and cycling trails, a community centre," he says.

"If land development costs are subsidised by government, those who want to invest in an income-producing property like duplexes and triplexes will be better able to do so at a lower cost and in a quicker time frame.

"The income-producing model is interesting because when you look at the list of distressed properties - those foreclosed by a lending institution for non-payment - of the hundreds on those lists, very few are duplexes or triplexes."

Mr Carey adopted the same solutions-oriented approach almost immediately after Dorian. With homes destroyed or uninhabitable, and thousands of people displaced, Mr Carey suggested investment by groups in distressed properties at reduced sales and closing costs.

Making use of foreclosed properties, he added, would take them off the lender's books and make them available for immediate near-term rental as well as improving neighbourhoods which suffered the repercussions of many empty structures, lessening the value of existing property nearby. For those who could afford to buy, the foreclosed properties would provide housing and an opportunity for the family inhabiting the dwelling to make improvements.

"Whenever there is a problem, you have to look for the solution," said Mr Carey. "After more than 35 years in the business, seeing the highs and living through the lows and watching the market as well as the people who work in real estate mature, I think of it the same way as I do a triathlon. You have to get through the worst part to get to the part you like best and,. eventually, even though it's tough, with enough stamina and determination, you get to the finish line."