The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Bahamas is suffering from a “12,000-plus” shortage of housing units, a Cabinet minister revealed yesterday, while conceding “we have our work cut our for us” to bridge that gap.

Keith Bell, minister of housing and urban renewal, in response to questions from attendees at the Exuma Business Outlook voicing concerns that economic growth and job creation are being held back by a lack of affordable homes for employees, said the Government is also seeking ways to lower construction costs as labour and material prices have risen “exponentially”.

Even going so far as to suggest “there’s no such thing as affordable housing” in present market conditions, he conceded that there was also a lack of market data given that the last nationwide study was conducted several decades ago.

“We know that the last big report has not been updated for the last two or three decades,” Mr Bell said, disclosing that the Davis administration’s Cabinet has just approved hiring someone with the necessary “expertise” to seemingly do the research.

“Again, the study back then indicated we should be building around 2,800 homes per year, and so far we are 12,000-plus short in terms of housing units. Each year has added, and in some years we didn’t build homes, so we have our work cut out for us.”

Mr Bell did not identify the study he was referring to, or whether the 12,000-home figure included both the Government’s housing programme and units constructed by private developers, although he seemed to be speaking solely to the former. 

A 1984 housing study, released as part of the current consultations on the Government’s proposed land reforms, forecast that to meet population expansion and housing demand The Bahamas would have to construct 1,965 residential units per year in the six years to 1990.

That report, released when ex-prime minister Hubert Ingraham was minister of housing and National Insurance in the Pindling government, forecast that during that six-year period some 1,515 residential homes per year would need to be constructed on New Providence; a further 262 per annum in Grand Bahama; and 188 in the Family Islands.

Mr Bell disclosed the extent of The Bahamas’ “affordable” housing shortage amid concerns the lack of such accommodation will restrict economic growth on islands such as Exuma and Eleuthera, especially as many landlords switch from long-term rentals to domestic tenants in favour of higher-rate, short-term vacation rentals to tourists.

One resort operator said: “Staniel Cay and Black Point, right now the lack of housing is affecting our ability to employ. We need to add staffing, and right now in Staniel Cay there’s no place for us to live.” Patrick Harrington, chief executive and managing partner at Exuma’s Peace and Plenty resort, also identified employee housing as a critical challenge facing his resort and the island’s wider tourism industry.

“Housing is of interest for us,” he said. “Multi-family housing would be very beneficial for the industry in terms of staffing and different operations.” Mr Harrington said having sufficient housing, which is available at the right price, is vital to his and other resorts being able to attract the right staff who can deliver the experiences and customer service demanded by guests.

“Where we are in Staniel Cay and Georgetown we need more housing,” he explained. “We need more multi-family housing. The cost of construction is so high so how can you develop as a multi-family builder and they have to be affordable housing. I see that being a challenge. We need more housing to bring in more staff... I see this being an ongoing challenge that we have to figure out in coming years.”

Mr Bell said the Government is exploring different construction techniques and methods in a bid to control costs and bring them down, and is also in talks with investors eyeing possible affordable residential developments as a way to tackle the shortage. However, he pointed out that any new builds must still be resilient enough to withstand the effects of climate change and more frequent and powerful hurricanes.

“One time ago we used to call it low-cost housing, and now we call it affordable housing but, quite frankly, across our islands including New Providence, there’s no such thing as affordable housing,” Mr Bell added. “The cost of materials has gone up, the cost of labour has gone up.....”

Besides demand, the minister added that “price point” is also critical to the Government’s housing programme. “Recently, we would have met with an investor and he wanted to build homes,” Mr Bell recalled. “When we went to a particular island, they wanted to build high-end homes. So I was quite taken aback that we were talking about $500,000 homes for a particular island.

“For us the average cost of a home in New Providence is $170,000. On the Family Islands, where it’s somewhat comparable, we know it can cost anywhere around $200,000-plus dollars. The cost of building materials has gone up exponentially.... We have to find a way to lower the cost.”