New rates for social housing tranches

On Friday 6th May, the MMC for Housing, Councilor Mlungisi Mabaso issued a press release reflecting the new tariffs published for social housing tranches.

Human Settlements Minister Mmamoloko Kubayi recently spoke to the media regarding social housing rate adjustments following the last adjustment to qualifying criteria in 2018 as tenants struggled to pay their rents due to inflation and the substantial increase in utility costs.

Kubayi announced the revised income brackets for households with gross monthly income between R1,850 and R22,000 to qualify, as opposed to the previous qualification criteria for household income between R1,500 and R15,000.

According to Kubayi, the goal is to align rates with the broader definition of affordable housing programs such as the Finance Linked Individual Subsidy Program (FLISP).

FLISP is a housing subsidy to help first-time home buyers buy a home, and for buyers to be eligible they must be in a certain income bracket which is considered the ‘gap market’ or the “missing link”.

The Johannesburg Social Housing Company (JOSHCO) provides rental housing to the lower and upper end of the low-income market (R1,500–R15,000), with the aim of creating sustainable human settlements. The Social Housing Regulatory Authority (SHRA) as one of JOSHCO’s main stakeholders who fund their projects.

According to Law 16 of 2008 on social housing and the Minister’s announcement of March 25:

• The household income limit threshold of the primary secondary market has been adjusted from R1,500 to R1,850 per month.

• The primary market household income limit threshold has been raised from R5,500 to R6,700 per month.

• The secondary market household income limit threshold has been raised from R15,000 to R22,000 per month, to align with the commonly known National Housing Scheme (FLISP).

According to Mabaso, these adjustments do not affect JOSHCO’s primary and secondary occupancy percentiles. Primary occupancy will remain at 30% and secondary occupancy at 70% within a project.

The adjustments are effective since Sunday, May 1 for the following projects:

• Devland – 255 units

• Dobsonville – 502 units

• Fleurhof junction – 452 units

• Fleurhof Riverside – 252 units

• Turffontein – 525 units

• Roodepoort – 423 units

• Union Square – 210 units

• City Deep – 329 units

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