Get more Mail & Guardian
Subscribe or Login

The state must prioritise a residential housing construction programme

COMMENT

Over the past 112 days under the Covid-19 lockdown, South Africans have spent an average of 70% to 80% of each day indoors. The home is not just a place for shelter, but our office, exercise space, playground, classroom and more. The home is our everything. 

For the fortunate 35% of South African’s population, this has been a reasonably comfortable and secure living experience. The same cannot be said for the remaining 65% who live in rural housing, township houses and informal structures. The experience during the lockdown has brought into focus the need for better housing and home ownership. 

Housing is a national imperative in South Africa’s transformation and development agenda. It must be a major part of the development plan to rebuild the economy in the post-Covid-19 era. Decent shelter is a basic human right and is needed to restore the dignity of its people and rebuild the economy.     

To reinvigorate the economy, the government needs to embark on a residential housing infrastructure development programme. The initiative would aim to promote job creation in the construction sector, small business owners in the form of artisans, while buying material and sourcing labour locally.  

Housing development is a value driver to long-term nation building, but it must be well understood and planned for. For example, the perception of what drives value in property is not as linear as location. If this were true, then the people living in Alexandra and Sandton would command the same values for their homes. Rather, it’s about understanding that properties gain their intrinsic value from the ecosystem that develops around them — hospitals, schools, shopping centres and so forth. The proximity and interconnected network of these amenities is what gives the housing its true value. 

Therefore if the government commits to residential development, it will be investing in long-term growth and development, as saleable assets that can be the wealth base.   

There are several pragmatic steps to achieve this feat. For example, by expanding the government subsidy programmes, such as the finance linked individual subsidy programme (FLISP), at a funding and as stakeholder level. 

The difficulty with a well-intended subsidy scheme like this is that it has been disconnected from key stakeholders — residential developers and institutions — who can unlock the funding opportunity for citizens. This limits its ability to be formally a part of the established process of applying for a home loan through the banking system. The FLISP programme should be designed to include the construction sector and lending institutions in an integrated value delivery system. This will ensure end-users are not burdened with the task of having to apply for subsidies separate from the process of applying for housing finance. 

In addition, one could explore alternative building methods that use low-cost materials and space-saving designs, to speed up the rate of delivery. For example, prefabricated material has been effective for commercial and residential buildings. Pre-fab is more affordable than bricks-and-mortar buildings and enables effective spatial home designs.  

The backlog for housing is more than 500 000 units and the demand grows daily. Increased accessibility to housing subsidies, acceptance of alternative building materials and the opportunity to create jobs makes a strong case for sustained economic and social development.  

For the economically inactive population, a free, decent housing programme is an opportunity to be part of a renewed broad-based black economic empowerment conversation. Decent housing is an asset base for previously disadvantaged families.

Subscribe to the M&G

Thanks for enjoying the Mail & Guardian, we’re proud of our 36 year history, throughout which we have delivered to readers the most important, unbiased stories in South Africa. Good journalism costs, though, and right from our very first edition we’ve relied on reader subscriptions to protect our independence.

Digital subscribers get access to all of our award-winning journalism, including premium features, as well as exclusive events, newsletters, webinars and the cryptic crossword. Click here to find out how to join them.

Tim Akinnusi
Tim Akinnusi is the founder and chief executive of MortgageMarket. He writes in his personal capacity

Related stories

WELCOME TO YOUR M&G

If you’re reading this, you clearly have great taste

If you haven’t already, you can subscribe to the Mail & Guardian for less than the cost of a cup of coffee a week, and get more great reads.

Already a subscriber? Sign in here

Advertising

Subscribers only

R15m to rid Gauteng of dirty air

The World Bank is funding a plan to deal with air pollution in Ekurhuleni, Tshwane and Johannesburg

Reservations about ‘new deal’ for rhinos, lions, elephant, leopards

Draft policy promotes species playing their role in wilderness systems but one conservationist says leopards are being sold out

More top stories

R15m to rid Gauteng of dirty air

The World Bank is funding a plan to deal with air pollution in Ekurhuleni, Tshwane and Johannesburg

Transaction Capital finds trust among used-car salesmen

The firm believes the second-hand vehicle business will thrive in a post-Covid world

The budget cuts that spite a nation’s face

Starving StatsSA of its ability to measure inequality may be a short-term face-saving strategy but it does not make the inequality disappear

Reservations about ‘new deal’ for rhinos, lions, elephant, leopards

Draft policy promotes species playing their role in wilderness systems but one conservationist says leopards are being sold out
Advertising

press releases

Loading latest Press Releases…
×