Re: Urgent Review of CAB-I Construction Cost Thresholds to Protect Homeownership Affordability
Dear Honorable Prime Minister, Minister of Finance,
I am writing to bring urgent attention to an issue within the Construct Antigua and Barbuda Initiative (CAB-I) that is increasingly undermining the very purpose for which the program was established: making homeownership more affordable and accessible to the people of Antigua and Barbuda.
The CAB-I program, which became operational in August 2011 under the Antigua and Barbuda Investment Authority (ABIA), was established to stimulate domestic economic activity while helping citizens and residents achieve the dream of homeownership. Through tax exemptions, discounts on construction materials and services, reduced mortgage and insurance rates, and other concessions, the initiative was intended to ease the financial burden of building or improving a home.
However, the program’s eligibility thresholds have failed to keep pace with the dramatic increase in construction costs over the past 15 years.
This raises a fundamental question: How can a program designed to make homeownership more affordable continue to operate with financial thresholds that no longer reflect the economic realities facing ordinary people?
When CAB-I was introduced in 2011, a typical concrete home with basic finishes could be constructed at an estimated cost of EC$150 to EC$200 or more per square foot. Today, in 2026, comparable basic-finish construction costs are estimated at approximately EC$350 to EC$400 or more per square foot.
Furthermore, CAB-I is reportedly now applying a construction valuation rate of approximately EC$450 per square foot, compared with approximately EC$200 per square foot in 2011. This represents an increase of 125% over the 2011 figure.
Yet, despite these substantial increases in construction costs, the program’s maximum qualifying value for new buildings remains EC$500,000.
The figures speak for themselves.
In 2011, a construction budget of EC$500,000 could support approximately 2,500 square feet at EC$200 per square foot. At today’s valuation rate of EC$450 per square foot, that same budget covers approximately 1,111 square feet.
In other words, the same financial threshold now accommodates less than half the floor area it once did, even before accounting for other project expenses that may be included in the overall construction budget.
This is not a minor adjustment that can be dismissed as an ordinary fluctuation in market prices. It is a substantial erosion of the program’s practical value to the very people it was designed to assist.
Why Should People Have to Build Smaller Homes to Qualify for Assistance?
The current arrangement creates an unreasonable dilemma for prospective homeowners. A person planning a modest, appropriately sized family home may find that the project exceeds the EC$500,000 eligibility threshold, even when the proposed construction is neither extravagant nor luxurious.
To remain eligible for the concession, that person may be forced to reduce the size of the home, compromise on the original design, or abandon important aspects of the intended living space.
Why should a family have to shrink its home plans to accommodate an outdated government threshold when the underlying increase in construction costs is beyond its control?
The cost of building a home has changed dramatically, but the qualifying ceiling has not changed accordingly.
The issue is not that people are seeking to build mansions at the public’s expense. It is that an ordinary home that might have comfortably qualified for assistance when the program was introduced can now fall outside the qualifying limit simply because the cost of constructing it has risen.
A concession that becomes increasingly inaccessible as the cost of homeownership rises risks losing its intended purpose.
The Wider Consequences for Homeownership and Housing Affordability
Honorable Prime Minister, this issue extends far beyond construction budgets and administrative thresholds. It directly affects housing affordability, household financial security, and the ability of citizens and residents to establish a stable home.
When prospective homeowners are unable to qualify for available concessions, they face even greater financial pressure at a time when land, building materials, labor, and other essential construction expenses are already placing homeownership further out of reach.
For some, the result may be a decision to abandon their plans to build. For others, it may mean settling for a home that is too small for their family’s household’s needs. Still others may be forced to remain in the rental market, paying increasingly exorbitant rents while struggling to save enough to build or purchase a home of their own.
There is an uncomfortable irony in this situation: people may find themselves paying substantial monthly rent that could otherwise contribute meaningfully toward a mortgage, yet they remain unable to make the transition to homeownership because the cost of building has outpaced the support intended to help them.
Rent does not build equity for the tenant. Homeownership, on the other hand, provides an opportunity to establish an asset, strengthen household financial security, and create something that can be passed on to future generations.
A government program designed to promote homeownership should not, through outdated eligibility criteria, inadvertently make that objective more difficult to achieve.
This is particularly concerning in an environment where affordable housing is already a major socioeconomic challenge. If the cost of construction continues to rise while the eligibility thresholds remain unchanged, the gap between those who can afford to build and those who cannot will only widen.
A Reasonable and Responsible Proposal
Honorable Prime Minister, I recognize that adjusting government concessions must be approached responsibly, with due consideration for public finances and the broader objectives of the program. I am not suggesting that the eligibility thresholds be increased automatically by the full 125% rise in the reported construction valuation rate.
Instead, I am proposing a measured and reasonable adjustment that acknowledges the realities of today’s construction market without seeking to match the entire increase.
Specifically, I respectfully recommend the following revisions to CAB-I’s qualifying project limits:
New construction: Increase the maximum qualifying project value from EC$500,000 to EC$600,000.
Renovations: Establish a maximum qualifying project value of EC$250,000, consistent with the existing renovation threshold, subject to confirmation of the applicable program rules.
Periodic reviews: Introduce a formal review mechanism every two to three years to ensure that the thresholds remain aligned with construction costs and general economic conditions.
The proposed increase for new construction amounts to just 20%, considerably less than the reported 125% increase in the valuation rate since 2011. This is a deliberately moderate request, intended to demonstrate that the objective is not to secure excessive concessions but to restore some measure of fairness and practicality to the program.
An increase to EC$600,000 would not eliminate the affordability challenges facing prospective homeowners. However, it would provide some additional flexibility for people seeking to construct modest, appropriately sized family homes without being disqualified simply because building costs have risen.
The EC$250,000 renovation threshold should likewise be maintained and clearly applied so that homeowners seeking to improve existing properties can continue to benefit from the program within its established parameters.
Additionally, a periodic review would help prevent the same problem from recurring. Rather than allowing thresholds to remain unchanged for another decade or more, the government could establish a transparent review process based on verified construction-cost data and the program’s fiscal objectives.
This would be a practical step toward ensuring that CAB-I remains relevant, effective, and responsive to the people it was designed to serve.
A Call for Urgent Action
Honorable Prime Minister, the people of Antigua and Barbuda should not have to choose between building a home that meets their family’s needs and qualifying for a government concession intended to make that home more affordable.
Nor should a program established in 2011 continue to operate as though construction costs have remained unchanged since that time.
CAB-I represents an important policy instrument for encouraging homeownership, supporting the construction sector, and stimulating economic activity. Its continued relevance, however, depends on the government’s willingness to review and modernize its provisions in response to changing economic realities.
I respectfully urge you to give this matter your urgent attention and initiate the necessary discussions with the Antigua and Barbuda Investment Authority to review and revise the qualifying thresholds.
A timely adjustment would provide meaningful relief to prospective homeowners, help preserve the original intent of CAB-I, and demonstrate that government concessions are being maintained in a manner that reflects the realities confronting the people they are intended to serve.
Homeownership should not become an increasingly distant aspiration simply because the policies designed to support it have been left behind by inflation.
The question is no longer whether construction costs have increased. The question is whether the government will take reasonable, practical steps to ensure that its homeownership assistance program keeps pace with those increases.
I am therefore calling for an urgent review and the adoption of the proposed EC$600,000 cap for new construction, alongside a clear and consistent application of the EC$250,000 renovation threshold.
The people of Antigua and Barbuda deserve a homeownership assistance program that reflects the economic realities of the present, not the circumstances of 2011.
I look forward to seeing this matter receive the attention and action it urgently deserves.
Yours respectfully,
Concerned Citizen
This article was originally published by Antigua News Room. Read the original article here: LETTER: Urgent Review of CAB-I Construction Cost Thresholds to Protect Homeownership Affordability.