THE Government-backed plan to build 96 "affordable" condos on the site of the former Loughlands Guest House will do nothing to help the bottom third of earners, according to Shadow Housing Minister Kim Swan.

The "underclass poor" was a growing section of the community whose needs had been "wilfully neglected" by the Government, he added.

"It's ironic that the legacy of the PLP 'people's government' has been to create all kinds of high-end, high-priced condo schemes, as Bermuda's hotel properties are slowly condominiumised from tourism to upscale housing that's untouchable for those who really need it," Sen. Swan said.

He added that only middle-income households could hope to keep their mortgage payments down to less than half of their income in order to buy the two- and three-bedroom units.

Housing Minister David Burch has said the condos would be sold for $450,000 or $500,000 each.

The Loughlands project, on a site on South Road, Paget, is a joint exercise between developer Gilbert Lopes and the Ministry of Works & Engineering & Housing and it will take an estimated three years to complete.

It was given fast-track planning permission by means of a Special Development Order (SDO). But no planning application was filed, which former Planning Department boss Erwin Adderley believes is unprecedented, and which has denied the public any opportunity to see the plans.

Another project at Southside will also see 54 more "affordable" units to be sold for between $450,000 and $525,000.

Sen. Swan described the lack of information on the Loughlands project as "shocking" and "a dangerous precedent".

He added: "In fact, there were no conditions in the SDO that required the private developer to actually build affordable housing.

"We in the United Bermuda Party (UBP) have already called for covenants to be placed on the sale of these units to ensure that at the very least, they are reserved for first time homeowners.

"However, at this point, we have no guarantees from Government that these units won't attract speculators who will buy and then flip the units for a quick profit."

Sen. Swan said the condos were not "affordable" homes for low-income families.

"They may be barely affordable to a middle-income household earning in excess of $80,000, but does nothing to address the plight of the 30 per cent of the population defined as poor or near poor (having a household income of up to $45,000) in the 2000 Census.

"In fact, to qualify for a $450,000 purchase price with a $50,000 down payment, a household's annual income would need to be more than $90,000 to keep their mortgage payments under 50 per cent of their income. According to the 2000 Census this would exclude more than 50 per cent of Bermudian households.

"Unfortunately, while the Loughlands project may help the housing shortage problem on a trickledown basis, it will do nothing to stem the widening gap between the haves and have-nots in Bermuda."

Those households earning less than $4,000 a month had no chance of affording a Loughlands condo, he added.

"That's why the UBP's affordable housing proposals, prior to the 2003 election, included mortgages that cost under $2,000 per month so that average Bermudian families could become home owners.

"In 2006, any household earning less than $45,000 per annum can only afford, realistically, $15,000 per annum on housing ($1,250 per month), which represents 33 per cent of their salary.

"Where can you even find a home to rent in Bermuda for $1,250 per month? The reality is that rents start at $1,500 but those deals are gone before they can ever reach the market, through word of mouth, referrals or networking, and Bermudian single-parent households are usually not the benefactor.

"You need only look at the rental prices in the classified section to realise the level of hopelessness that exists for families wanting to put a roof over their heads.

"The Government has been well aware of the growing underclass poor for more that half a decade, without responding to the real problems confronting the working class in Bermuda. Government inaction is creating an underclass and at this late stage can be characterised as wilful neglect."