Wednesday, December 19, 2012

Nation's Non-Existent Affordable Housing Programme

The government's recent demolition of houses in Lenasia, apart from anything else, has exposed how inadequate the state is at providing housing for those who neither qualify for bank mortgages, nor for RDP houses.

The Lenasia families seem to fall into the category of those who qualify for so-called "gap housing" on the basis that they earn between R2200 and about R7500 per month and can therefore afford to pay for their homes. However, gap housing is being rolled out at a snail's pace.

There is much fanfare in a city when a "gap" social housing project of 100 or 200 units is unveiled. But these projects only happen about once a year. Many are not built close to the city and some look little better than the national government's upgraded RDP houses, or "Breaking New Ground" dwellings, even though they are much more expensive to buy or rent.

There is clearly a growing number of people who can't afford market-related bonds but who can raise capital of up to R150 000 to buy land, as they did in Lenasia, where they were unfortunately taken advantage of by fraudsters.

However, there is nowhere for this growing group of people to go when they want to stop renting and start buying homes. Like the poor who often find themselves waiting years for a tiny RDP house, potential gap market homeowners are falling through the cracks.

Government claims that it would be impossibly expensive for it to roll out a programme that would actually deliver a house to everyone who needs a home. By this they mean that they would prefer to spend public money on arms deals, subsidies and rebates to private corporations, and lately nuclear power and upgrades to the presidential home at Nkandla. It seems obvious that if there are people who can afford to pay for land or for a portion of a home, that government should be working with these people and not against them.

However, government has failed to develop a proper social housing programme, which could deliver to people who seem capable of raising funds to get onto the property ladder, as the Lenasia case has demonstrated.

A social and gap housing project could consist of government rezoning and then selling vacant state land to people who can afford to buy land and build their own houses, or partnering with non-profit organisations to build 'mixed-income' developments where the poor and not so poor live side by side. In some countries, such a programme involves building housing developments and then selling a 25% share in the home to someone who then purchases the rest of the shares over time.

There is no such national programme in South Africa.

The government's current "gap" housing programme consists of different projects by the municipalities (all involving delivering very tiny numbers of gap houses every year). There are a few scattered partnerships with non-profit companies here and there. But the combined result of these projects is not making a dent in South Africa's housing problem.

Government has set up a Social Housing Regulatory Authority, whose mandate is to "regulate and invest to deliver affordable rental homes and renew communities". Their strategic plan for the next five years is to approve the building of an average of 5,434 social housing "units" per year. Given that there is a housing backlog of millions, these 5,434 units are a drop in the ocean. Since the authority only approved the building of just over 1000 units last year, even this might be over-optimistic. It also doesn't help people who would prefer to spend their money on buying a home rather than renting. It really is not clear whether the Social Housing Regulatory Authority intends to raise its game and start delivering to the millions of people who currently make up the "gap market".

Government's insistence on privatised housing delivery is as much of an obstacle to it providing gap housing as it has been to RDP housing. The private companies hired by government don't only build poor quality houses for the poor; they also build bad houses and flats for the gap market.

The N2 Gateway flats in Langa, Cape Town were supposed to be a flagship demonstration of the future of social housing in South Africa - built for working people who could afford to pay about R600 per month rent. But when these flats were handed over, residents found to their dismay that costs had been cut to such an extent that 28 units could be opened with one key. Just months later, the flats started leaking and cracking. The renters moved out and the only people who eventually benefitted were the private companies involved in building the flats.

Human Settlements minister Tokyo Sexwale has been saying for over 18 months that he is considering setting up a state housing company to speed up delivery and get money-making private companies out of the picture, but these plans are not progressing beyond talk.

Sexwale has also said that there should be a cut off date for the provision of free housing. And his "each one, settle one" campaign launched at the Johannesburg Stock Exchange 15 months ago, where he called upon "captains of industry" to build houses, has also not taken off. He has made several different and conflicting announcements about the future of housing in South Africa, which does not bode well for anyone seeking either an RDP or a gap house.

Meanwhile, working people are continuing to reject the high-priced free market rental system and look for ways to use their money wisely to build their own homes. In Cape Town, the backyard residents of Mandela Park near Khayelitsha were promised 80 plots of land by the Western Cape MEC for Human Settlements, Bonginkosi Madikizela, in 2010. This promise has still not been fulfilled. In the meantime, residents there have cut through the red tape and spent up to R40 000 each building proper houses on the land.

From time to time, Western Cape government officials arrive on the scene and mark their houses for demolition. The tragedy is that this land was earmarked for those residents anyway - the residents are also doing government a favour by spending their own money on building their houses instead of staying in backyards where they could have demanded more free services. Due to the fact that their houses are not being recognised by the state, Mandela Park is another Lenasia just waiting to happen.

Having a home is the first step towards ushering in some certainty in people's lives. It is the foundation for the development of a stable and secure society. Do our leaders not see this?

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