Increase mortgage rates - Steele

Monique Grange, Assistant News Editor
The Gleaner/Power 106 News Centre

Financial Analyst Colin Steele says the government should increase the mortgage rates for borrowers of the National Housing Trust (NHT), not reduce them.

The Gleaner/Power106 News Centre understands that the Prime Minister Portia Simpson Miller is expected to announce reduced NHT interest rates during her budget presentation this afternoon.

However, Steele, who is also a member of the economic policy committee of the Private Sector Organisation of Jamaica, said such a decision needs to be reviewed before implemented.

He believes the money given up if the rates are reduced could be used for new mortgages or to build more houses.

Steele is also of the view that the mortgage rates should be increased every five years.

In 2010, Former Prime Minister Bruce Golding announced a 1 percentage point reduction in the NHT interest rates and also increased the loan limit by $1 million.

Meanwhile, Steele is urging the government to seriously consider the proposal to offer employers a contribution holiday.

According to him, the government has not made any cash payments to the NHT since 2002 and this has not affected the NHT’s resources.

In light of this, he said the government does not have the moral authority not to consider a payment holiday to other employers.

rdaio@gleanerjm.com