New gazetted rates for social housing band

Minister Mmamoloko Kubayi, Minister of Human Settlements, Water and Sanitation recently addressed the media regarding social housing rates adjustments.

These rate adjustments followed the last adjustment of the qualification criteria in 2018, where tenants were struggling to pay their rent due to inflation and substantial increases in utility costs.

The minister announced the revised income thresholds are for households earning between R1 850 and R22 000 gross monthly income to qualify, as opposed to the previous qualification criteria for a household income of between R1 500 to R15 000.

The Minister aimed at aligning the rates with the broader definition of the affordable housing programmes such as the Finance Linked Individual Subsidy Programme (FLISP).

FLISP is a housing subsidy for first-time home buyers. To qualify, the buyers have to fall within a certain income bracket that is considered the gap market or the missing middle-income bracket.

JOSHCO, the City of Johannesburg Social Housing entity, provides good quality rental accommodation for the lower and upper end of the low-income market (R1 500 – R15000), intending to create sustainable human settlements. Therefore the board and entity’s accounting officer would apply the adjusted rates to JOSHCO projects that are funded by the Social Housing Regulatory Authority (SHRA).

According to the Social Housing Act, 2008 (Act 16 of 2008) and the minister’s announcement on March 25 the threshold of the sub-primary markets household income limit has been adjusted from R1 500 to R1 850 per month. The threshold of the primary markets household income limit has been increased from R5 500 to R6 700 per month. The threshold of the secondary markets household income limit has been increased from R15 000 to R22 000 per month, to align with the National Housing Programme also known as the FLISP.

The announced adjustments do not affect JOSHCO’s primary and secondary occupancy percentiles.

The primary occupancy will remain at 30% and secondary at 70% occupancy within a project.

The adjustments are effective from May 1 for the following projects, respectively:

• 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)

All these projects are expected to comply with the act.