No more free houses



August 12, 2016
No more free houses

Human Settlements MEC Bonginkosi Madikizela.

Minister tells those on 'the list' to save if they want brick homes.

Western Cape housing minister Bonginkosi Madikizela says mense should stop expecting free houses from government.

The Human Settlements MEC says South Africa’s economy cannot sustain giving houses away for free, and that people should start saving their money if they ever hope to live in a brick house.

“It costs around R220 000 to build one house, which we give free to people who qualify. We know that the economy of South Africa is not growing fast enough, and on the other hand we are not tapping into a culture of saving. The thinking that we can just give a free house to everyone must come to an end,” he said.

Madikizela made the remarks while delivering a keynote address at the Institute of Estate Agents of South Africa/National Association of Realtors Property Update at Lookout Hill, Khayelitsha, on Wednesday.

He said although the government has reached its RDP target of providing one million houses in five years, housing is expensive and the focus needs to shift toward the affordable or “gap” market.

According to the Cape Argus, Madikizela said the Western Cape’s population had increased by 38.8 percent between 2001 and this year, accounting for 11.3 percent of SA’s total population.

“Free housing as a response to housing need is financially unsustainable and the focus must change to those who can contribute financially towards their own housing,” he said.

He said despite high unemployment, the Western Cape had about 593 000 households earning between R3 500 and R15 000, families fitting into the gap housing sector.

He said some of the challenges facing this sector included credit worthiness, affordability, reduced income earning capacity and rapid population growth.

About 45 percent of the 23.11 million credit active consumers in South Africa have bad credit records, the major reason why banks decline bond applications.

National Association of Realtors president Tom Salomone spoke of the importance of home ownership.

“It is more than just having a roof over your head. One of the most important aspects of home ownership in South Africa is how it affects children,” he said.

“Home ownership builds stronger families. People who are home owners report higher life satisfaction, self-esteem and control over life. Home ownership creates jobs.”

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