NHC-National Housing Corporation
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Explain Calculations: Show me the calculations and amortization
 
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Affordable Housing

Barbados can easily achieve affordable housing; however, we are not achieving it for two principal reasons, each of which we are generally oblivious.

The first reason is that we are unaware that we cannot afford the substandard houses that we have built for the past 12 years. The start of this current building boom saw inexperienced persons offering themselves as building contractors. Fortuitously, national building standards were published 2 years prior; however, the inexperienced builders were not required to comply with them.

The second reason is that home owners do not plan adequately and therefore run out of money before the house is completed. Home owners are normally unaware that they are building houses that they simply cannot afford.

The easiest way to get affordable housing, from low-income to middle-income ranges, would be to apply with us . Otherwise I would recommend that potential home owners adhere to the following procedure to realize an affordable house. The assumption here is that 100% of your construction budget will come from the mortgage institution.

1. Go to your mortgage institution to determine the amount of mortgage loan that you qualify for. It is critically important that you deduct an estimate of the bridging interest from this amount.

2. Assume a construction cost of $250 per square foot of floor space. Then divide your actual loan by $250 and the result is the total floor space in square feet that you should tell your designer not to exceed. Your house can be built for less than $250 per sq ft; however, you should have a buffer to deal with the risks associated with building like unforeseen ground conditions for your foundations.

3. After carefully reviewing your design drawings, and obtaining Planning permission, select honest and competent builders by obtaining and checking references.

4. Obtain a construction contract. You can obtain a useful one from the Barbados Association of Quantity Surveyors for $15.
(Tel:246 228-0598).

5. Obtain a copy of the Barbados National Building Code from the Barbados National Standards Institution for $100.
(Tel:246 426-3870)

6. Include in the construction contract that the builder must not build below the minimum structural requirements of the Barbados National Building Code. Complying with this standard can be done at no additional cost.

7. Also identify in your contract a fair and technically competent adjudicator to whom both sides can refer disputes.

8. Invite at least two builders to competitively bid on the project. Before they provide their bids, ask them if they need any additional information. You should ensure that the bidder is aware of the following: wall, floor, and ceiling finishes, roof covering, door and window types, lighting and plumbing fixtures, and the proposed construction contract. If you have not decided on your fixtures, then ask them to quote for labour only on an assumed fixture.

9. Regularly visit the construction site and see if you notice substandard work. You can view some typical examples of substandard in the construction section of this website. If your builder insists on doing substandard work, then dismiss him and find a more responsible builder.

10. Do not pay your builder until he has completed each stage of work properly and in accordance with the national standard.

Note:
With the current cost of building materials, you can still build a comfortable and safe house for $150/sq-ft. You can build for less if you consider some creative designs that require less material. For example, you can consider an open plan for the kitchen, dining room and living room rather than having each room enclosed with walls. Those walls have a material and labour cost attached to them.

You can also consider using a Trowel Plastic type wall finish rather than painting. With Trowel Plastic, you make one application, with paint you make at least 3 applications, and each application has a material and labour component. The labour component is higher for a 2-storey house where there is a lot of external scaffolding to be moved around

 

Adapted and reproduced with the kind permission by Grenville Phillips