LOW-COST AND SOCIAL HOUSING IN SOUTH AFRICA

A priority of the Reconstruction and Development Programme

After coming to power in 1994 the African National Congress (ANC) committed itself to build 1 million low-cost houses in 5 years, as a priority of the Reconstruction and Development Program (RDP). This was to be achieved through a state capital subsidy scheme plus private sector participation in financing and construction.

The intention was that at least some poor beneficiaries would top up the subsidy with bank loans in order to build bigger houses, and that others would extend their houses over time. However, banks only entered the low-cost housing market to a limited extent, due to high risks and limited returns, in spite of various mechanisms developed by government to facilitate their participation.

The housing subsidy system was initially difficult for people to understand and access, due to its complexity. This led to most subsidies being accessed through larger housing development projects, planned by municipalities and built by private construction companies. Bridging finance was needed in many projects, until subsidies were paid out.

Though subsidies have been periodically increased, their value was constantly eroded by increasing construction costs, and a large proportion of subsidies went to installing service infrastructure. The result was that very small houses were built, in some cases as small as 15 m², though some projects managed up to 40 m² houses. But most were ‘core houses’, often without finishes such as flooring, ceilings and internal doors, and with no hot water geysers.

Low-cost housing was mostly located on cheap, municipal owned peripheral land, far from amenities and work opportunities, which resulted in high transport costs and further reinforced the apartheid geography and marginalisation of the poor in South African cities. The housing concept in apartheid townships – the single, free-standing unit on a small plot (a mini version of the norm in white suburbs) – continued to dominate post 1994 subsidy housing.

In spite of problems regarding the minimum standards and the peripheral location of most subsidy housing, the SA Government has nevertheless enabled the building of about 2 million houses since 1994, for poor families who would otherwise still be living in shacks, in many cases on unserviced land. Most of these houses are assets owned by the subsidy beneficiaries. Most have subsequently been improved and many have been extended, which is part of the core house concept. This is an achievement that ranks among the most significant in state-driven low-cost housing provision in developing countries in the past decade.

In an attempt to improve the housing situation for the poor, a new act was passed in 1997, which provided clear roles in low-cost housing delivery for provinces, municipalities and communities. The People’s Housing Process (PHP) was also designed in a way that would improve housing through beneficiary participation.

During the past decade, the concept of higher density housing has gained ground. The new national housing policy ‘Breaking New Ground’, aimed at creating integrated communities instead of just housing areas, is a sign of the changed perspective. People in general are beginning to recognise that well-located, high density developments save costs for households through better access to social and commercial services and public transport, and entail lower infrastructure and service costs. Higher densities thus enable larger, better quality homes through public, communal and household cost saving.

Social housing is another recently developed instrument in South Africa’s extensive housing programme. The new Social Housing Policy aims to provide medium-to-high density housing, particularly for rental, to individuals and families eligible for housing subsidies. The policy requires that social housing be included in municipal Integrated Development Plans (IDPs), as social housing in South Africa constitutes a very small proportion of government subsidized housing.

The new social housing instrument supplements other social housing related instruments such as the institutional subsidy, the discount benefit scheme and hostel redevelopment. The instrument has resulted in a redefinition of social housing and in new funding, institutional and capacity building arrangements. The Sida Urban Programme aimed to assist in the development of policies, processes and best practices, rather than in mass production of housing units. The Programme promoted innovative, low-cost housing solutions to achieve sustainable development and improve the quality of housing for the urban poor. Projects included establishing revolving funds, social housing associations and housing support centres, constructing sustainable housing and supporting the People’s Housing Process.

The projects in this booklet contribute to the understanding that housing is a process and not only an end in itself, and that it must be user-oriented. All projects thus promoted public participation, integrated planning, innovative designs, economically viable standards for low-cost construction, and increased densification in better quality urban environments. Sida-supported projects have also aimed to be sustainable in financial and other respects, setting up saving schemes and including attention to environmental issues, gender equity and mitigation of HIV and AIDS.