Column: Chris Famous On Housing & More

Column: Chris Famous On Housing & More

[Opinion column written by MP Chris Famous]

“My landlord has given me notice..”

“I can’t find any affordable units…”

Two sentences that are heard fairly often. Definitely too often for some. The reasons may include the following:

Lack of rental payments
Sale of property
Foreclosure of property
Unresolvable issues
Need for relatives to move in
Need for renovations

It is unfair to paint a picture that all landlords are just randomly giving notice or not renewing leases.

We are in a time that many landlords find themselves facing fluctuating mortgage rates and or ever increasing maintenance costs. Even if the property is paid for there are constant items in a house that need attention whether it be plumbing, electrical or structural. The property owners have to find the funds to pay the bank and or service providers.

Realistic costs

“In a recent Pew Research Center survey, 69% of Americans said they were “very concerned” about the cost of housing, up from 61% in April 2023.”

Pewresearch.org

As seen above, the cost of housing is going up in all developed countries.

The unfortunate reality is that despite the Bermuda Government dropping custom duties for construction material from 25% down to 10%, the cost of homeownership still rises. Here are some of the following reasons:

Mortgage rates fluctuating
Homeowner insurance rising
The cost of all skilled labour has risen. eg plumbers are near $100 per hour
Overseas cost of materials has risen before it even reaches Bermuda

As prime examples:

the cost of construction in now at $800-$1000 per square foot
Appliance repairs start at $100 per hour
Water heater replacement are roughly $1000
Land tax bills

Property Owner vs Tenant

For those wishing to become property owners vs. renters, the fact is much sacrifice and savings will be needed.

Live with relatives as long as possible to save on paying high rent and pool your resources with those you trust. Ideally, you would need to try and get a mortgage before the age of 40 as banks generally are giving 25 year loan repayments. Put as much as you can aside toward a downpayment and in doing so you are able to show the banks that your saving habits match their criteria.

This will mean sacrificing some of the following:

Frequent trips

Online shopping
Buying lunch daily
Eating out weekly

Don’t take my word for it. Each of us can go through our monthly bank statements and see where we could have cut out some spending. Equally as important, for property owners who are able, it is best to learn some basic maintenance skills such as landscaping minor plumbing, carpentry and painting.

In closing, it is painful to hear the challenges of finding a place to rent. The government, via the Bermuda Housing Corporation [BHC] and the Bermuda Land Management Corporation [BLMC] is doing its part in renovating units and breaking ground on new projects for affordable rentals. The reality is that home ownership requires a lifestyle and lifetime of fiscal and mental discipline.

- Chris Famous, MP for Constituency #11, Devonshire East

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