South african housing shortage drives up prices

The FNB CPF head of Residential and Affordable Housing explains: “The demand for housing remains high, particularly in metropolitan areas as a result of rapid and continued urbanisation.

“While subsidised housing (Breaking New Ground) is aimed at families  earning up to R3, 500 per month, the income bracket between R3, 500 and R15, 000 is known as the affordable housing segment, and homes can be acquired through a combination of government subsidies and conventional mortgage bond finance.”

The result is a surge in real estate values, reports SA Commercial Property News, which has left a group of the market – “the GAP market”, those earning between R3,500 and R7,500 – with limited housing options.

“It is impossible to build houses at prices which would suit this segment, unless land and infrastructure costs can be minimised,” commented Laing. “This segment of the market is therefore reliant on rental tenure as opposed to outright ownership.”

To try and combat the situation, FNB CPF has launched a new project, The Windmill Park, in Boksburg, aiming to build 830 units in a high-quality development designed for the affordable housing sector.

“FNB is very proud to be involved in such an exciting development such as Windmill Park. This is just one of the many flagship projects we as a bank are in involved in, and we will continue to add value and sustainability to the growing Affordable Housing market,” added Laing.