NHT Increases Microfinance Loan Ceiling to $1.95 Million for Home Repairs and Improvements

Kingston, Jamaica — 15 December 2023

The National Housing Trust has raised the ceiling on its Housing Microfinance Loan programme to $1.95 million, up from the previous $1.1 million maximum, effective December 2023. The loan product, which enables NHT contributors to borrow at subsidised terms for home repairs, improvements, and staged construction, is accessible without affecting the contributor’s entitlement to the main NHT housing loan. Combined, a qualifying contributor can access up to $9.45 million in total NHT financing: $7.5 million from the standard mortgage programme and $1.95 million from the microfinance facility.

The microfinance product targets the large population of Jamaican homeowners and renters who own land, have a partial structure, or live in a home requiring meaningful repair, but do not have the savings or the loan eligibility to complete or restore their dwelling through conventional finance. These are people who own an asset but cannot access the capital to realise its potential. The microfinance loan is the NHT’s response to that gap.

The Incremental Builder in Jamaica

Jamaica has a long and culturally embedded tradition of incremental homebuilding. Families acquire land, build when resources allow, pause when they do not, and resume years or decades later. The result is a large stock of partially completed homes scattered across every parish: structures with walls but no roof, roofs but no electricity, interiors that have not been finished in 15 years because the money for tiles and plumbing has never accumulated to the critical mass required.

The microfinance ceiling of $1.95 million is not large enough to finish a full house in 2023’s construction cost environment, but it is large enough to complete a specific stage: run the electrical, plaster and tile a set of rooms, add a bathroom, put up the fence. That incremental utility is precisely the design intent. It is a tool for the person who is 70 per cent done and needs the capital to finish.

“The microfinance product is underrated as a housing policy instrument,” said Dean Jones, Managing Director of Jamaica Homes. “The majority of the housing stock that needs improvement in Jamaica is already built. What it lacks is repair and finishing capital. The NHT’s decision to increase the ceiling acknowledges that reality and provides more capacity to address it.”

The Five-Year Term

Microfinance loans under the NHT facility carry terms of up to five years, covering various stages of construction and improvement work. A five-year term on a $1.95 million loan at NHT’s subsidised rates produces a monthly payment that the majority of contributing workers can manage alongside their standard living expenses. The term is short enough to keep the facility revolving and long enough to make the payments accessible.

The facility’s ability to combine with the main NHT loan is its most powerful feature. A contributor accessing $7.5 million toward a purchase and $1.95 million toward the fit-out and improvement of that same property has a total financing package of $9.45 million available from a single institutional source, at rates that no commercial lender would offer. That is the NHT’s genuine social value expressed in a product design, and the microfinance ceiling increase makes it more valuable still.