A turnkey home or the land?
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Introduction
In February 2023 the Government announced its housing policy. In October 2024, the Government made amendments to the Crown Land Ordinance. I had the opportunity to interview the Deputy Premier and the Minister of Planning and Infrastructure on Financially Speaking Show on Tuesday October 29th, 2024.
We all know there is a housing crisis in our country whether the prices are too high or there is a shortage of homes or apartments. I think it is great that the Government is trying to address it through the Crown Land Amendment and Housing Policy but of course there are some pros and cons.
In this article, I will look at Turnkey home vs the grant of land. I will also look whether the housing policy should incorporate ownership of the development company to be 100% Turks and Caicos Islander rather than 50%.
The Crown Land Amendment Ordinance 2024 and the Housing Policy
The crown land amendment ordinance is repealing the definition of commercial development. Commercial development means “any development which is not for private residential or agricultural purposes and includes the use of land by a developer for the building on one parcel of more than one residence for sale or lease to individuals for private residential purposes such as the creation of affordable housing, social housing or emergency housing.”
This means that commercial development can now also include residential housing development. The Housing Policy also allows developers to acquire freehold title to crown land at a 50% discount once it is being used for affordable, social or emergency housing. The Developing Company must be at least 50% owned by a Turks and Caicos Islander.
Affordable Housing
The amendment states that affordable housing means “housing that does not exceed 30% of a household individual gross monthly income.
The amendment states that emergency housing means “housing the primary purpose of which is to provide temporary accommodations for individuals or families who are homeless or at imminent risk of becoming homeless.”
Social Housing
The amendment states that social housing means “housing option provided by the Government or non-profit organizations at a low or subsidized cost, primarily aimed at assisting individuals and families who are unable to afford market-rate housing due to their income levels.”
Turkey homes vs land
Land is a scare resource; it does not grow and there is only so much land that the Government has. Due to the small amount of land that the Government has available, many people will get left out and so I do support the Government initiative in encouraging the development of housing schemes. The housing scheme should consist of multiple buildings with multiple floors like our condominiums at our resorts. In this way, more people will be able to benefit by owning a unit in the housing scheme. I do hope that will be the way the Government encourages.
The truth is some of the land has been divided up to be big. For example, the land in Chalk Sound is 1 acre which probably could have been split further into three lots and more people could have benefited. Some people also get the land and don’t develop it and just sit on it. Some people also start a home and do not complete the home. Some people don’t have the money to start the construction of homes as construction costs are very high. These are some of the reasons why I prefer a turnkey home.
We need homes now. Young people are returning home and want to return home and don’t want to live with their parents. Furthermore, some people who are already here (locals and expatriates) are unable to secure housing. Some people also are discouraged because they have to purchase the land, and they have to invest so much in the house before they are qualified to borrow from the bank. By having turnkey homes, this will help with the above situations immediately. Of course, we will still have the issues of work permit holders finding a place and so local people should be encouraged to build apartments and the good news is that the Housing Policy will provide concessions if you build five apartments or more.
Developer company should be 100% Turks and Cacios Islander
I wrote about this before and I will continue to write about this. Given that this a crown land and we want to empower Turks and Caicos Islanders, I think that that the residential developer company should be 100% owned by Turks and Caicos Islanders. I think by having 50% we are making it a disadvantage for Turks and Caicos Islanders, and we are also encouraging fronting. If we say 100%, this should be an incentive for Turks and Caicos Islanders to come together and build houses on crown land and sell it to Turks and Caicos Islanders.
I also said on my show that perhaps the Government should build the homes and partner with local construction companies and the bank. Hopefully this can be done once the Government starts a Mortgage Institution.
Only TCI Islanders can own homes.
While anyone can build the homes (as long as 50% are Turks and Caicos Islanders), I do like the fact that only Turk sand Caicos Islanders can own the homes. I also like the fact that they cannot transfer it to a non-Turk sand Caicos Islander. This will be enforced unlike previous housing schemes that were built on Crown Land but with no restriction on home ownership.
The homes will range from $125,000 to $250,000. Yes, the interest will perhaps double if you are borrowing but if you are paying rent, you are paying someone else’s mortgage so why don’t you get your own home and pay for your own interest.
Conclusion
As I mentioned on my show, I am now using this article to encourage some Turks and Caicos Islanders to come together form a company, apply for the crown land and develop it for housing for Turk and Caicos Islanders.
I also want to encourage Turks and Caicos Islanders, that this is an opportunity for you to own your own home. Please pursue it and if you want a separate piece of land, then put aside some money to buy a private piece of land.
I encourage the Government to proceed with this housing initiative but only allow the Crown Land developers to be 100% Turks and Caicos Islanders.