The cost of living in Bermuda: Are you paying a reasonable rent? *File photo



The severe downturn in the economy, reduced work hours, loss of jobs are causing great hardship to many families as they struggle to meet mortgage payments, pay rent and buy food.

People who relied on rental properties to supplement their retirement income are also experiencing difficulties as many rental units stand empty. It is difficult to recall any time when so many ‘For Sale’ signs adorned the countryside.

Between 1970 and 2000, the percentage of land used for residential purposes in Bermuda increased twice as much as population growth and was accompanied by a 21% reduction in open space.

As explained by Bermuda’s Sustainable Development Unit (SDU), while “many Bermudians believe that [Bermuda’s housing] problem is centred in a lack of available housing...  The issue [is] that the majority of housing in Bermuda is simply not affordable.”

There appears to be a conflict between speculative housing development and housing built to fulfill society’s needs, with most housing being constructed at the middle to upper-middle price range while the real need for housing is at the lower end.

Speculation-driven housing construction may be forgiven where there is much land available, but here in Bermuda where open space, arable and other amenity land areas are already small and rapidly shrinking, the social costs of speculative housing construction outweigh the benefits to the community. 

The average gross salary in Bermuda rounds to $4,500 per month and, as late as November 2010, the average monthly rental price was $4,543 for a single family property or $3,576 for a two-bedroom apartment.

This suggests that, after payment of rent, meeting day-to-day living expenses is likely to be a struggle for many families with a single provider.  As explained by Bermuda’s SDU, the “concern with inaffordable housing is that where rent or mortgage is exorbitantly high, families are forced to take on 2nd and 3rd jobs to make ends meet.

Further complications include an inability of parents to enroll their children in extracurricular activities due to a lack of funds.  These children are often left to their own devices after school...”. 

According to family advocate Sheelagh Cooper, the escalation of many of Bermuda’s social problems, including gang violence, prostitution and poverty, are fundamentally caused by economic issues, the root of which is often a lack of affordable rental accommodation.

According to the Bermuda Rent Commission, rent control prices, ranging from $900 to $1,300 per month for a studio to $2,200 to $2,800 per month for a three-bedroom, are applicable to 54% of properties on the island.

Despite these controls, anecdotal evidence suggests that many of these properties currently rent for more than the stipulated maximums.  Better publicising and enforcing of Bermuda’s rent control laws could help many lower income families meet their day-to-day expenses and lead to a reduction in the social problems associated with families in economic distress. In addition, these actions could increase the ability of renters to one day afford to buy a property of their own.

BEST supports that speculative residential development be actively discouraged and that future development take place on brownfield rather than greenfield sites, where possible.  In addition, BEST supports efforts to address the lack of affordable housing that focus on ensuring fair and affordable rents, rather than building more homes in an already saturated marketplace.

This could potentially include allocating more resources to the Rent Control Commission and better communicating its role and the laws in place to protect renters of lower valued properties.
