Department of Housing

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Department of Housing
COMMONWEALTH OF PUERTO RICO
JORGE RIVERA JIMÉNEZ Secretary Departament of
Housing
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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO.

• Strategies to Overcome the Barriers to Affordable
  Housing

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO

• Introduction
• 3.9 million inhabitants with an average income of
  20,425.00, one third of the U.S. average.
• 45.4 of the population lives under the poverty
  line.
• 1,434,322 housing units, 81 of them are single
  detach family houses.
• 74 of them are owned by its resident.
• The average value of the units is 98,000.00.
• The housing demand is approximately 19,000 units
  a year.
• Only 50 of the population can afford housing
  units of more than 90,000.
• Construction costs are expected to increase in
  the following years.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Barriers to Affordable Housing in Puerto
Rico GAP BETWEEN FAMILY INCOME AND HOUSING
COSTS.

• For 2005, the housing affordability ratio was
  4.9, while is projected that it will be 6.7 by
  the year 2025.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Barriers to Affordable Housing in Puerto
Rico REDUCTION OF CREDIT ALTERNATIVES

• Crisis in the mortgage industry and in the
  financial markets.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO

• Barriers to Affordable Housing in Puerto Rico
• RISING DEVELOPMENT COSTS
• Land Value
• Construction Costs (materials, labor and
  transportation)

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO

• Barriers to Affordable Housing in Puerto Rico
• BURDENSOME AND LENGHTY PERMITTING PROCESS
• Many government agencies involved.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Barriers to Affordable Housing in Puerto
Rico AVAILABILITY OF LAND
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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• Law 124, Subsidies to the Development and
  Acquisition of Affordable Housing.
• Subsidies and incentives for developers and
  families.
• Prize of the houses under this program is cap at
  125,000.00.
• offers developers tax credits on profits per
  unit, special planning and construction
  parameters, exemptions in payments of impact
  fees, among other things.
• To families and individuals offers reduce
  interest in mortgages, subsidies of 5 of the
  purchasing prize and subsidies for the monthly
  payment.
• Since 2001, more than 100,000 units have been
  developed under this program.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• La Llave para tu Hogar (Key to your Home),
  Subsidies for the Acquisition of the First Time
  Home.
• Subsidies to families for the acquisition of
  their first home.
• From 5,000.00 up to 40,000.00.
• Since the establishment of this program, the
  Department of Housing has provided these grants
  (an average of 8,600.00 per family) to more than
  22,000 families. Investment of over 272 million.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• El FHA Boricua (The Puerto Rican FHA),
  Mortgage Insurance for Moderate Income Housing.
• New mortgage insurance program for families with
  income of a maximum of 130,000.00 to buy homes
  from 120,000.00 to 300,000.00.
• 270 families have received this benefit,
  representing an investment of 42 million.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• Tax Credit for the Acquisition of Housing.
• New tax credit of 25,000 for the acquisition of
  housing.
• Since its implementation last year, more than
  7,000 families have been able to purchase their
  homes.
• investment of more than 110 million.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• Participation with the Private Sector in the
  Interim or Construction Financing of Affordable
  Housing.
• Program to participate in the interim or
  construction financing of affordable housing
  projects with private lending institutions.
• Investment of 100 million.
• Approximately 2,500 housing units.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• Law 173, Incentives for the Development of
  Housing for the Elderly.
• Subsidies for rental units for the elderly.
• 3,800 units with an investment of 456 million.
• 1,000 additional units during this year.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• Comunidades Especiales, Construction and
  Rehabilitation of Homes in Informal Urban and
  Rural Communities.
• Direct construction of new housing units or
  rehabilitation of existing ones in the most
  needed rural and urban communities of Puerto
  Rico.
• 4,300 units have been built or rebuilt with an
  investment of more than 238 million, since 2005.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• El Nuevo Modelo de Permisos, (The New
  Permitting Process Model).
• Complex and lengthy process that adds additional
  costs and delays to the development of housing
  projects.
• Participation, giving comments, evaluations and
  endorsements, of many governmental agencies.
• Government of Puerto Rico established last year a
  new permitting process model. Developer submits
  a project for evaluation and approval in one
  single place and there, all the agencies involve
  or with jurisdiction in the development process
  evaluates the project.

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Americas Affordable Communities
InitiativeAFFODABLE HOUSING PUBLIC POLICY FOR
PUERTO RICO
Initiatives and Strategies to Overcome Barriers
to Affordable Housing in Puerto Rico.

• Public-Private Partnerships and Land Banks for
  the Development of Affordable Housing.
• The public sector would acquire land, obtain all
  the necessary entitlements (permits and
  approvals) and invest in major infrastructure and
  then will make that land available to the private
  sector to develop the housing projects.
• Land Bank for the development of affordable
  housing.

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Department of Housing
COMMONWEALTH OF PUERTO RICO
JORGE RIVERA JIMÉNEZ Secretary Departament of
Housing