Mr. Speaker,
I rise before this honourable House today to address the status of housing in Bermuda and to share with honourable Members that this Government is committed to ensuring there is a sustainable supply of accessible and affordable housing for all who want or need it.
Mr. Speaker,
Currently, there is an acute housing shortage which is a result of the current demand for housing outpacing the current supply. Given our stated desire to increase the number of jobs in our economy leading to a larger working population, the expansion of Bermuda’s housing stock will be necessary to accommodate a greater number of individuals working in Bermuda.
The strong private sector housing market along with legislation controlling the rents of a sizeable portion of Bermuda's housing stock has, up until now, ensured a sustainable housing supply required for the population's housing needs. While the Government facilitated the development of Bermuda's real estate market, the private sector was the driver of the inventory growth, and the economy was less reliant on Government for Bermuda's housing stock.
As a result of this reduction in the supply of private sector housing across the island, Bermuda is now facing what can be considered a housing crisis. The decrease in supply is also driving up the cost of rental accommodations. This housing challenge presents a risk to Bermuda's economic development initiatives of which the Government is determined to mitigate.
Mr. Speaker,
To help resolve this housing problem, various policies and interventions are needed at distinct levels relying on both public and private sector involvement to garner solutions.
As such, the Government will support the expansion of residential dwellings in Economic Empowerment Zones. The City of Hamilton will play a significant role in the expansion of residential development opportunities. The City of Hamilton Plan 2023 recognises that residential development is an essential component of revitalising the City. This presents an untapped opportunity to grow the residential population in the island’s capital thereby creating a vibrant economic hub where persons can live, work, and play.
Mr. Speaker,
Approved Residential Schemes are development proposals that are either fully comprised of residential units or are mixed-use developments comprised of both commercial spaces and residential units. These Schemes are an economic development tool that provide a tangible mechanism and pathway to bring the development vision and objectives of the local plan to life within the Economic Empowerment Zones.
The North-East Hamilton Local Plan 2022, prepared by the Department of Planning in partnership with the Bermuda Economic Development Corporation, regulates the development and use of land in North-East Hamilton.
Currently, Approved Residential Schemes are restricted to the Economic Empowerment Zones in Somerset, St. George’s, and Northeast Hamilton. However, it is now necessary to expand the areas where Approved Residential Schemes can be constructed. Therefore, the Government will seek to expand the eligibility for Approved Residential Schemes from solely the Economic Empowerment Zones to the entire City of Hamilton.
This Government committed to providing $15 million over the next three years to build more affordable public housing units. In addition, the Ministry of Public Works, through the BHC, is undertaking the renovation/retrofit of 137 older residential units to increase the amount of affordable housing options for Bermudians. Sixty (60) of these units are presently occupied and will undergo minor-to-medium refurbishments.
The remaining 77 are units representing the entire stock of vacant and derelict units that require major retrofits. These 77 units will be added to the BHC rental unit inventory bringing the total amount to 777. These newly added units are set to be priced under the Rent Geared to Income-based scheme which is capped at 35% (25% rent & 10% savings) of the total household income. This programme allows for low and middle income families to afford a quality standard of living as well as save 10% of their household income.
Mr. Speaker,
There has been significant infrastructure investment by the Ministry of Public Works to help increase the stock of affordable housing throughout the country. As of September 2023, the efforts to increase the BHC stock include the following:
- 3 Rock Oven Lane – majority of work has been completed
- 5 Aunt Jinny’s Lane – works completed and occupied
- Harmony Block B – 8 units are completed and ready for occupancy
- Harmony D & E – demolition and pre-construction work continues
- 27 Beacon Hill – 5-bedroom rooming house completed
- 22 Battery Road – delayed completion date is November 2023
- 18 and 20 Battery Road – awaiting building permit for 16 units
- Chelsea Apartments – awaiting planning approval
- 1 Grandstand Lane – works completed
- Regent House St. George – works completed
- Wellington Road St. George – reviewing tenders
The Government will encourage and support housing developments in residential zones as highlighted in the Bermuda Plan and specific plans for other geographical areas.
The Department of Planning’s records indicate that there is a total of 582 parcels or 181 acres of vacant Residential 1, Residential 2 or rural land without conservation area development restrictions.
The data analysis for housing demand and supply indicates that there is ample land available, if required, to meet housing demands within existing residential zoned areas as well as the Mixed-Use Zones and the City of Hamilton. It is therefore not essential to zone any new lands as residential.
Mr. Speaker,
The current Morgan’s Point site is targeted for conversion into a mixed-use site for the development of a range of residential rental apartments including a component for seniors’ housing, with an active and engaging amenities district. This project will positively impact Bermuda's residential rental market and the overall economy.
Mr. Speaker,
The first phase of this project should partially address this deficiency in supply by adding some 101 units within 2-3 years with the capacity to scale up. This development will include an amenities village containing dining and retail businesses, a farmer’s market and a boardwalk all of which which would be open to the public. At the center of this redevelopment plan is the concept of “Live, Work, Play” all onsite. Pricing for the apartments in the Morgan’s Point amenities district is expected to be affordable. The overall additional supply should help to reduce the cost of residential properties in the broader market.
Mr. Speaker,
The Government will continue its work to support the increase in Bermuda’s housing inventory. In this regard, the current environment of an expanding economy presents an opportunity for those seeking to develop. The private housing sector can assist by:
- Investing in housing development projects.
- Renovating unused and derelict apartments and place them back into Bermuda housing inventory.
- Removing properties from the vacation rental market and making them available to renters.
In addition, the banks can assist by:
- Partnering will the Government to offer favorable mortgage terms to those seeking home ownership.
- Making capital available for potential development projects.
- Ensuring foreclosed properties are placed back into the housing inventory in a timely manner.
Mr. Speaker,
The Government will continue to build on a raft of recommendations for changes to these Acts to provide a balance between the needs of Landlords, as well as those of tenants.
This will propose recommended legislative changes that reflect today’s rental market with a specific view to clarifying critical issues on which the current legislation is silent. No-one wants to be disadvantaged by having their properties destroyed or lost due to poor tenancy behaviours, and conversely, the desire is not to see persons evicted due to poor landlord attitudes and behaviours.
Mr. Speaker,
In conclusion, Bermuda’s housing crisis is a complex and multifaceted issue that requires a comprehensive, coordinated and collaborative approach from various stakeholders and sectors. There is no single solution, but rather a variety of possible solutions that can be tailored to the specific context and needs of Bermuda. Understanding that addressing this crisis will take time, it can be solved by implementing effective and efficient policies and interventions. Resultantly, access to adequate and affordable housing can be realized for all who want and/or need it.
Thank you, Mr. Speaker.