Haiti's housing bubble, more pressing to some than election or Aristide

Amid jitters over the expected return today of exiled former President Jean-Bertrand Aristide less than 48 hours before a presidential election here, many Haitians face a more basic problem: a housing bubble that is pricing many locals out of their homes.

Real estate prices, particularly rents, have skyrocketed in Port-au-Prince since last year’s earthquake that killed over 200,000 people and displaced 1.5 million more.

“The quake destroyed thousands of housing and office units in the city and brought an influx of non-governmental organizations from around the world,” says Beverly Bell, founder of Other Worlds, a US-based non-profit that supports over 30 grassroots community organizations in Haiti.

The foreign organizations and their workers often have more funds at their disposal than the average Haitian organization or worker.

“There’s a dual economy here since the earthquake – the international NGO economy, and then what everyone else can pay. Rental prices in Port-au-Prince are now 5 to 10 times higher than before the quake. There’s a sense now among many Haitian property owners that now is the time you can get rich,” she says.

NGOs can afford to pay double

That's leading many Haitian civic organizations and non-profits, including a large number of churches and schools, to work from improvised spaces, some setting up in the backyards of other organizations or operating out of tents in refugee camps.

By the end of this year, Marie-Jose Poux has to find a new home for her orphanage and free school, Foyer Espoir Pour Les Enfants, founded after last year’s earthquake in the Delmas section of Port-au-Prince. Seventy-six children attend the school, and 34 orphans ranging in age from 6 months to 12 years old live in the home. But earlier this year the property’s owner began demanding more rent and recently informed Ms. Poux that he will not renew her lease.

“He knows that he can rent to an NGO for twice what I’m paying him,” says Poux, a resident of New Orleans and native of Port-au-Prince who has worked with orphans in Haiti’s capital for more than a decade. “I’ve been looking for something else but there is nothing we can afford. Everything suitable has been taken by NGOs – they have the big money.”

'Disaster economy'

Harley Etienne, a native of Haiti and assistant professor of city and regional planning at Georgia Tech University, agrees that a so-called “disaster economy” has hugely inflated the Haitian capital’s real estate market. Even before the quake, Haiti was known as "the Republic of NGOs." That was only exacerbated after Jan. 12, 2010.

“The prices are way out of scale, to the point that I don’t know how you can justify some of it,” says Mr. Etienne, who is part of a US-based research team assessing earthquake damage in Haiti and its impact on local communities. “Part of it is tied to how devalued the Haitian currency is, but Haitian property owners are certainly trying to get some money while the getting is good.”

While NGOs are inflating the costs of office space, foreign professionals working for NGOs are also driving up the cost of private housing.

“I know that Oxfam has its own compound that provides residential housing, but a lot of NGOs don’t,” he says. “Property owners know this and are holding out for top dollar from foreign doctors and engineers.”

Marie-Jose Poux, who runs the orphanage in Delmas, has taken her landlord to court to fight paying an extra $6,000 he is demanding on her current lease. Meanwhile, she has found a vacant lot in the area for sale for $80,000, but estimates she would need at least another $100,000 to start building a permanent home for the orphanage. Her current location, which employs six teachers using three indoor and three outdoor classrooms, is already cramped.

“We have a waiting list of 25 more children who want to enroll, but there is no space for them,” she says. “I know we are doing God’s work here, and He will provide us something, but this is a very frustrating situation.”