How will South Africa’s new FLISP subsidy work?
There has been a lot of interest in the design of the new housing subsidy announced by President Zuma in his State of the Nation Address in February, and many questions have been coming into this site. This is to be expected, over twenty percent of South Africa’s population earns in the income bracket defined by the new subsidy – this is the so-called gap market where people have been struggling to get housing they can afford. According to the President’s speech, the new subsidy went into effect on 1 April 2012. It is unfortunate that nothing has been published on the government’s websites to explain the policy and how it will work. No official policy has been released – it must still be approved by the meeting of the Minister with the nine provincial MECs. Thankfully, a very helpful official at the National Department of Human Settlements offered me answers to some of the questions.
1. How will it work?
Essentially the subsidy is planned to work like this: A household earning between R3501-R15000 per month needs to find a newly built house for sale at a price of R300 000 or less, and then apply to a bank for a mortgage to buy that house. If the household qualifies for the mortgage, they will be allowed to complete a subsidy application form, which the bank will then submit to the National Housing Finance Corporation (NHFC). The NHFC is the National Implementing Agent for the subsidy, and is entering into agreements with the nine provinces and various banks to make these processes work. Once the NHFC has approved the subsidy application (the amount you qualify for is in this table), the money will be paid to the seller either directly by the NHFC or via the bank, and the borrower will then get a mortgage loan from the bank for the remaining amount of the purchase price, which they’ll then repay over time.
In the short term, the subsidy will only apply to newly built houses that cost less than R300 000. This means that the buyer cannot simply find any house on the market – they need to find a new one, in a new project that is underway. While the government has also introduced a new incentive for developers to build housing for this price, its not clear if there will be much ready for sale when the subsidy scheme comes into effect on 1 April 2012. A quick scan of the Internet found some houses costing less than R300 000, but not many:
- The least-expensive home available from Cosmpolitan projects is a 40m2 unit in a project called Beverly Hills in Palm Springs, Gauteng. This is in the range, costing R278 000. All of Cosmpolitan’s other projects are above R300 000 per house, however. (www.cosmojhb.co.za/now_selling_page.html)
- RBA Homes has four developments listed. The cheapest of these is Bram Fisherville – 40m2 full title, free standing home at R327 400 (http://rbahomes.co.za/bram-fischerville-listings)
- Calgro M3 (www.calgrom3.com) seems to be working hard to offer housing below the R300 000 range. In Gauteng, they have a sectional title development in Fleurhof, with a 40m2 and a 43m2 unit both going for under R300 000. In Jabulani Heights, a development in Soweto, Gauteng, prices start at R242 000. Scottsdene is another Calgro M3 development, in the Western Cape, where prices are envisaged to range between R240 000 – R340 000 for apartments. Freestanding houses will start from R360 000.
Its not clear if this R300 000 price limitation is inclusive or exclusive of VAT. This is a particularly important issue – worth up to R42 000.
2. How much is it worth?
The subsidy works on a sliding scale for households earning between R3501 – R15 000 per month. Households with lower incomes will qualify for more subsidy, and those with higher incomes qualify for less. The subsidy table can be downloaded here.
The subsidy is only available, however, if the applicant is also accessing mortgage finance. Households who finance their housing with a pension backed loan or a housing microloan will not be able to access the subsidy. While the subsidy only applies to new houses delivered in new projects, this limitation is unlikely to make much difference. By virtue of the price of new housing, the subsidy will only go to households at the upper end of the income spectrum. Households earning less than about R8000 per month are unlikely to afford the properties available even with the new FLISP subsidy. Hopefully, once the programme has been rolled out, individual applications to purchase existing properties in the resale market, will be entertained. The Department has promised this – it is only through the resale market, where far many more houses costing less than R300 000 can be found, that lower income households in the target market will be able to benefit from the subsidy.
Even if the subsidy is made available for buying houses on the resale market, however, the requirement that the subsidy be linked to mortgage finance will undermine the breadth of the population that is able to access the subsidy. Certainly there are households in South Africa who earn more than R3500 per month (so, are ineligible for an RDP housing subsidy) but whose income is erratic or informal, making them ineligible for a mortgage. Domestic workers, for example, or taxi drivers, farm labourers, spaza shop owners and others all fall into this category. In order to access a mortgage loan, they would need a payslip, and to be able to enter into a twenty-year commitment to make regular monthly payments. Without these, access to a mortgage is unlikely. And without access to a mortgage, they would be unable to access the subsidy. This creates, perhaps, a new “gap” market, between those able to access housing in terms of the RDP subsidy programme, and those able to access the new FLISP subsidy.
3. What can individuals do to access the subsidy?
This is the most difficult question to answer – and it’s a real problem that there is no information available on the website. Ultimately, buyers who fall in the eligibility range have to first find a house – so, contact the developers in your area and ask them how they plan to deliver to this opportunity. Then you have to build the network of finance – bringing in your savings (if you have any), applying for and being approved for a mortgage, and then, with the assistance of your bank, applying for the subsidy from the NHFC. This is a complicated process, and hopefully the developers, banks and NHFC will provide assistance to help first time homebuyers meet their housing needs. It also offers an opportunity for estate agents working in this market to develop their skills and improve their understanding of how the subsidy works and how it can be accessed. In the meantime, I urge everyone to give the NHFC a call so that they understand the pressure they are under to deliver: 011-644-9800. The National Department of Housing’s telephone number is 0800-1-46873. Please write and tell me if they give you any more information!
i am earning less than R8000pm, that means wont be getting a government sudsidies anytime soon since jouburg run out of low cost houses prices ranges from R300000.00.
what does one needs to do now??
Hello Sampson. You’re probably right. With an income of R8000 (and assuming you have no other credit outstanding) you might be able to afford a mortgage of about R232 000, paying R2400 per month over twenty years at an interest rate of 11% (I’m assuming a rate of prime + 2% just to be conservative – if you were able to get prime interest of 9%, then your mortgage affordability would increase to about R266 000). At R8000 per month you’d be eligible to apply for a subsidy of R57 300. So, if you qualify for 11% interest at the bank, your total housing affordability would be R232 000 + R57 300 = R289 300. If you could manage to get your mortgage loan at 9% interest, however, you your total housing affordability could be R266 000 + R57 300 = R323 300. That’s great, but what we don’t know is if the R300 000 price maximum is inclusive or exclusive of VAT. If its inclusive of VAT, then you’re fine – except that there won’t be much housing available for R300 000 including VAT. If its exclusive of VAT, it is likely that most houses will be priced at R300 000 + 14% = R342 000, which means that even at 9% interest you won’t be able to afford the product price. This is really confusing. Please go to the bank – visit all the banks you know – and test your eligibility for a mortgage loan and the interest rate at which they’ll give you the loan. Banks compete, so you may find that one may give you a lower rate in order to get you as a client. Also make sure that you can afford not only the monthly payment as it is now (for you, it would be R2400), but also what it may become should interest rates rise. We’re at a low point in our interest rate cycle and many people think it will eventually go up. When it does, your monthly repayment obligation will increase. You have to make sure you can afford that.
Of course, the real solution to your problem would be if the new FLISP subsidy were available to individuals wanting to buy homes on the resale market. Then you’d be able to buy a house for less than R300 000, and it would be more within your affordability, possibly costing less per month, depending on its price. Maybe that’s what you should do anyway, and just forgo the subsidy – see if you can find a house on the resale market that you can afford. There aren’t many, but I’ve seen some older houses, or inner city flats for sale more in the R200 000 market and below. Hopefully the Department of Human Settlements will change their policy soon to allow people to buy houses on the resale market. If they don’t, they won’t be helping people other than those at the high end of the FLISP target market.
Hi there kecia
what about the people that pay less then R3500 that cant even afford to stay in a seperate entrance cause they need to do allot with they money why cant the bank help these peoples and maybe let them pay R500 to the bank every month or why cant the Government one time take all that money and built free houses for people who dont have and let them pay rent every month
Hi Rashia. You make a very interesting point: you’re prepared to pay towards your housing even though you earn less than R3500. This is something the government hasn’t thought about. In principle, you should be able to access a house for free. As you are surely aware, however, we’re not building these houses fast enough and the waiting list is very long. The Department of Human Settlements is currently going through a policy re-think. I wonder if other people would be willing to pay if it meant that they could access housing more quickly.
Hi kercia, Im blacklisted and Salary is R4700 – R5700. Huband not blacklisted Salary R4000- R5000. Do we qualify for any housing Subidy? We renting at the moment R2500 and feel like we cud have paid bond for our own house.
Shona, you have to resolve your credit situation before you can apply for mortgage finance to buy a house. The National Credit Regulator offers a useful brochure on managing your finances, which also discusses how you apply for debt counselling – you can download the brochure from here: http://www.ncr.org.za/publications/brochure5.pdf Between you and your husband, it looks like you could qualify for a FLISP subsidy, and also for mortgage finance, if it is put into your husband’s name as he is not blacklisted. But you still need to clear your own credit situation – and if you are still in debt, this will limit the amount of credit for which you can qualify. I think you need to clarify this with your bank, however, and also with the National Housing Finance Corporation who manage the FLISP. Their number is 011-644-9800. Good luck.
I have read and understood this whole document. i would like to make the president aware that yet again he manages to screw us over. i am a single mother with two children. please show me where to find a house of R 300 000 that is newly built. close to my children’s school. we seem to be in a position that will only allow us to pay off other peoples bonds. At this rate i will never be able to own my own home. after paying for my rent and basic Necessities i have no money left, cause my rent is costing me R 5500 per month. this is to live close to my children’s school and for them to be in a save environment. you need to relook the crap in this policy. I cant even qualify for a R 400 000 home loan. we the majority are just being robbed of our rights in this country. what help will a R 22 850 provide myself and my children. even if we find a house that’s newly built, guess what, no schools in the new developed area. more expenses on traveling and endangering the lives of our children. So mr president, you live in a lovely home, you don’t have to worry about the safety of your children, how they get to school, cause you would like to put us in a rural area, to suffer more than what we are already. please anybody make sense out of this for me. cause all the ministers are not putting themselves in our shoes. Why must i move to an area uproot my children cause it has to be R300 000 and newly build??
Hi there. I’ve been thinking about your question all weekend. Of course you’re right: there are far too few houses being built at a cost of R300 000 or less to satisfy all the people who might be able to use the FLISP subsidy to buy them. And, when new projects are developed (for there are some), they’re often not in established areas, are more likely to be away from your established routes: your children’s school, your work, etc. It doesn’t seem right at all. At the same time, we live in a country where there is substantial disadvantage, and gross inequality. Sixty percent of our population earns enough to qualify for the RDP subsidy. That subsidy costs the government upwards of R150 000 per house to build. While not all households in this income bracket are poorly housed (some are already beneficiaries of the RDP subsidy programme), this is an enormous demand on the State. Another 25% of the population earns within the FLISP target market. In this bracket, the subsidy obligation of the State is anywhere between R15 000 – R87 000 per household. You’d agree this makes sense: that higher income earning people get less State support than people who earn nothing or very little. But still, to deliver housing in this bracket is an enormous undertaking, involving the participation of the State, the private sector, and in many cases also communities themselves. It takes a lot of time. The FLISP subsidy programme is only starting to kick into gear now. The President announced two weeks ago that government has spent R70 million so far, across eight projects. While that’s not a lot, its a start, and there has already been someone on this website who has reported that they received the FLISP subsidy. So its starting to work. Slowly.
That said, I agree with you: new build is not affordable, especially to lower income FLISP target market households. It would make a lot of sense if they could extend the subsidy to also allow purchases of existing houses, because these are cheaper. I think they’re worried about how to manage this – the potential for fraud is much greater in the resale market than in the new build market. But its on the agenda – when the policy was announced, it was said that this current phase is a pilot, to test demand and see how it all works.
So, I recommend you hang tight and wait. I do hope the policy is revised soon. In the meantime, you should make sure your debt situation is under control, and that you save as much as you possibly can, so that when the time does come that the FLISP is applied to the resale market, you have a nice deposit that you can also offer to the bank. Or, you may wish to forgo the subsidy and look for a house that is affordable to you now. There aren’t many, but as you point out, there certainly are some. I can hear that you’re not in an easy situation. Good luck, and thanks so much for sharing your experience.
This housing subsidy?what about single parents who already own homes and are battling to improve their homes.Its very unfair that one has to only purchase a home within a certain bracket.
Can anyone else apply for financial help for the homes or the improvemnets thereof!
Hi Belinda – I understand your frustration, but already the government is subsidising an enormous proportion of our population. About 60% of South African households earn less than R3500 per month – making them eligible to apply for an RDP house. Then, another 25% or so of households earn between R3500 – R15 000 per month. This means that our government is committed to subsidising the housing needs of 85% of the population. This is unheard of internationally, and is a significant imposition on our fiscus. What is unfair, or short-sighted, is that the subsidy only applies to those accessing mortgage finance, and only applies to the purchase of new housing. This means that people who can only afford a resale market house, or for whom a mortgage loan may be inaccessible (but who might finance their housing with savings, or with a pension-backed loan or housing micro loan) are disadvantaged.
Hi I am earning R6882.00 per month and I dont have Life assurence would I Be able to apply for the subsidy .
Sophia, life insurance is not a requirement to access the subsidy, although it is possible that the bank will require this for the bond. You will need to ask the bank about a life insurance product to tie with your bond. Take a look at the blog I’ve just written on how the subsidy works. At the bottom of the blog, there are links to the NFHC’s documents, providing information on how much you qualify for, where to apply, and what the conditions are.
I earn less than 8000 as well and cannot qualify for an RDP house as we earn too much.when i first saw this head line in feb 2012 i was excited but nothing happend.No notification on how to apply or when.
I was really loking forward because this meant that i can finally buy a house as a first time buyer.
Not sure what to do now!
Hi there. You are in a difficult position – the new “gap” market so to speak. You probably could afford to buy a house on the resale market, but the subsidy isn’t available for that at this stage. You have a couple options. You could buy a house on the resale market right now, without the subsidy. If you are earning R7500 and if you have no other credit obligations, you could possibly afford a mortgage of about R215 000 (calculated at 11% interest, over 20 years, with a monthly bond repayment of R2250). That’s enough to buy an existing house on the resale market in some areas, or to buy a sectional title flat in some inner city areas. Or you could hang tight and hope that the FLISP subsidy will eventually become available. This might give you about R60 000 (at the current rates, if you earn R7500). This would bring your affordability to about R275 000 – still not enough to buy a new house, but a substantial amount for a good, entry-level house on the resale market.
hi kecia, i would like to know a person that earns R9500 a month,how much subsidy am i going to qualify for.
Hello. At R9500 per month, you could qualify for FLISP subsidy of R47 175. To access this subsidy, you would have to first find a new house for sale costing less than R300 000, and then apply and be approved for a mortgage. The bank would then help you with your FLISP subsidy application. If you have no other credit obligations, it is possible that you could possibly qualify for a mortgage of about R275 000 (calculated at 11% interest over 20 years with a monthly bond repayment of about R2800). The downside of course, is that there aren’t so many houses available for less than R300 000. But the possibility that you do qualify is an important message for developers who will start to build for this market.
hi i forgot an impotant thing to mention that I’ve got a loan that I’m repaying ,will it make an difference to the amount that I’ll get from my subsidy as you stated on your reply.if yes could you please advice me on what must I do then because I really want to buy a house.
Hello there. Your outstanding loan obligations won’t influence the amount of subsidy you can get, but they will influence the size of mortgage loan that you will qualify for. Your best bet is to go to a bank, show them your financials, and ask them how much of a loan you will qualify for. The subsidy cannot be accessed if you don’t also access a mortgage loan at the same time.
hi there, I would like to know if i want to buy a house that cost R345000 do I still qualify in terms of the criteria, beacause you said previous I must find a house less than R300000. This house I’m talking about is the new developed house that are being build in ilitha park in Khayelitsha and I’m interested in buying that house.
I’m afraid at the moment, the policy limits the price of the house you can buy to R300 000. Perhaps call the NHFC and ask them if there are any houses being built that will be eligible for the subsidy in your area. Then you can decide if you want to wait for those, or forgo the subsidy and buy this house that you’ve found. Their number is 011-644-9800
Good Day.
I think the intentions are good but the application via Banks with vigorous credit checks that need to meet certain criteria or score is rather unfair, Many who have bad credit record either by being victims of the recent financial meltdown resulting in losing their Job and unable to meet their obligations or have been blacklisted by same institutions for failing to pay their student loans due to no work in the market.
Is this the only way of applying for this subsidy?
Hi Sbo. The FLISP subsidy is available only for those who earn a household income of R3501-R15000 per month, and who can access mortgage finance to buy a new house costing less than R300 000. However, there is one exception. If you can’t access mortgage finance, for whatever reason, and earn less than R7000, you can decide to apply to your municipality or Provincial Department for the allocation of a vacant serviced stand. If they have such a stand available and you’re approved, you would get it for free, in lieu of the subsidy. You can also apply for an Individual Housing Subsidy to buy a serviced stand from a private sector developer – but only up to the cost of a State-financed serviced stand. Its all a bit complicated, and I’m not sure the policy document itself makes it any easier. Take a look at the document posted on this website: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ and read especially Section 5, which starts on page 7 of the document. The other issue you raise, about blacklisting, is something you should address with the National Credit Regulator. You can visit their site on http://www.ncr.org.za to get more details.
Hi
I’m getting paid R7500 do I qualify for a subsidy? And I got a house that is less then R300000 in mind . How do I go about getting it?
Hello Morvin. The policy document has just been posted on this website: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ That will give you all the rules and conditions. According to the payment tables there, you should be able to apply for a subsidy worth about R60 675. However, at this point in time you can only use the subsidy to buy a house in one of the NHFC-approved pilot projects. This is something I didn’t quite understand before I saw the policy document, and it means that its going to be even more difficult to access your house. If the house you have in mind is a new house, currently being built, ask the developer if the project is part of the NHFC pilot. You can also call the NHFC on 011-644-9800. If the house is not new, then it can’t be included in the programme at this stage. Good luck!
Hi
My gross salary is R5800,so will I qualify for subsidy if I want to buy an old residential property,or is it only available for new properties?
Thanking you in advance
Bernadine
Bernie, hi. The policy document has just been posted on this website: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ That will give you all the rules and conditions. According to the payment tables there, you should be able to apply for a subsidy worth about R72 150. Unfortunately, however, at this stage, you can only use it to buy a new house in an NHFC-approved pilot project – and there will be one in each province. However, there is an interesting exception to the policy. Households earning R3501-R7000, who cannot access mortgage finance, can decide to rather access a serviced stand. To get this, you have to apply to your municipality or Province – they would have to have a stand available, and if you qualify, you could get it entirely for free. You could also apply to the province for an Individual Subsidy to buy a private sector developed stand – but only within the costs of what a State-delivered serviced stand would cost. I’m not sure how this will all work but perhaps you should contact your local municipality or Province and find out. Then you can access a loan and contract someone to build a house on it – step by step, on an incremental basis, you could realise the home you require.
Hi I am earning R7400 a month and pay loans of R1800 a month,I want to know if I want to know what must I do to apply?for how much will I qualify?
Hi Martha. The amount of subsidy for which you qualify has nothing to do with the credit you owe. That only has an impact on the amount of mortgage finance you could get to add to the subsidy, and so would have an impact on the cost of house you could afford to buy. At R7400 per month, you may be able to access a subsidy of about R61 350. The policy document has just been posted on this website: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ That will give you all the rules and conditions. Then, if I imagine that your income after payments is about R5600, you could possibly afford a mortgage of about R159 000 or so (please check this with your bank). That would mean that you could afford to buy a house of about R220 000. I’m not sure if there will be any houses for that cost in the nine pilot projects that the NHFC implements – its unlikely. In the long term they should amend the policy to allow people to buy houses on the resale market – then the subsidy could work for you.
About the rental that are introduced now whereby you pay R700 a month,do I also qualify for that?
Hi Martha. Yes, I think at your income you should be able to qualify for social housing – that’s what the rental you’re talking about is called. Your best bet would be to go to the company that’s offering rental accommodation at that amount and see if you do qualify.
Hi,
i like to know if the salary is in terms of gross income or net because my salary was recently increased this month to 15300 gross but my net is 10800 will I qualify for the subsidy and I have 2 loans that i’m repaying at the moment.
Hi Pinky. According to the policy, which you can download from here http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/, it is your gross income that is calculated (see paragraph (g) on page 7). This would mean that you would not qualify. Your credit situation will also have an impact on the size of loan for which you can qualify. In your situation, the best bet is to repay your loans and start to build your savings. When you’re in a stronger financial position you can then look for a house available on the resale market – those will be much cheaper than new houses and you’ll probably be able to afford one even without the subsidy.
WHAT I WILL LIKE TO KNOW THE PEOPLE WHO ARE EARNING LESS THAN 5000 PER MONTH, THEY CAN’NT AFFORD TO BUY A HOUSEAND THEY PAY A RENTAL ROOM FOR 920 PER MONTH. WHAT’S A PLAN TO BE DONE THERE SO THAT WE CAN AFFORD TO BUY A HOUSE
Hi Lillian. With a monthly payment of R920, you could access a loan of about R87 000 (at 11% interest over 20 years). If your income is R4900 per month, you could be eligible to apply for a FLISP subsidy of about R77 000. This would bring your overall housing affordability to R164 000. You’re right: this is not enough to buy a new house, and at the moment, the subsidy only applies to the purchase of new houses. The government has said, however, that they hope to extend the subsidy to resale property in the future. While you wait for the policy to change in this direction, try to save towards buying a house – set up a special savings account just for your house – and wait until this policy change.
Hi kecia
My net salary is 4500.00 would I qualify for the housing subsidy,I stay at gauteng is it possible for me to buy a house in another province using the housing subsidy,province like limpopo because bond houses are cheaper than gauteng.
I also want to know if I applied for a low cost house,how does the housing subsidy work.
Thank you
Hi Lebo. At R4500, you can apply for a subsidy of about R80 925. The loan you would be eligible for – if you have no other credit outstanding – could be R130 000, which would bring your overall housing affordability to about R210 925. Yes, you can certainly buy a house in another province, but if you don’t have any savings to add onto the R210 925, then its unlikely you can access the programme at this stage. Also remember that at this stage, the subsidy only applies in NHFC-approved projects. I’ve heard that they’ve started with nine pilot projects – one in each province. You need to call the NHFC to find out the name of the developer doing the FLISP pilot project in Limpopo, then call that developer and ask if they have any houses available at the price you can afford. If they do, you need to apply for a mortgage from a bank to buy the house, and then the bank will help you apply for the subsidy. Call the NHFC. Their number is 011-644-9800.
Hi !I’m currently earning R10,000 how much do I qulify for?and since there are no new development in my area can’t I buy a house from someone
Hello Beauty. At R10 000 income, you should be able to qualify for a FLISP subsidy of about R43 800. If you have no other credit outstanding, you may then be able to qualify for a mortgage loan of about R290 000 (at 11% interest over 20 years). You’re exactly in the target market where the FLISP is useful: you earn enough and the FLISP is big enough to make a difference. At this stage, however, you can only use it to buy a NEW house that costs less than R300 000. You can’t use it to buy an existing house: it has to be newly built in a development approved by the NHFC. Call the NHFC and ask them to tell you where there are houses available: 011-644-9800.
Hi kecia
Thanks for the replied,I think it is not possible for me to access this subsidy at this point,for the low cost houses how does this subsidy work because I applied for a low cost house,and their site it is a new project,how will I benefit from the subsidy.
Thank you
Hi Lebo. Your best bet is to read the policy and then call the NHFC on 011-644-9800. Generally, I’m guessing that new houses will go for not much less than R300 000 – although the Department has said that they want to encourage builders to build even cheaper houses. Within your affordability range, I’m guessing it might be better for you to wait until the policy allows people to access the subsidy for the purchase of used or existing houses in the resale market.
Hi kecia
I Just want to know about this subsidy housing. I really need a house in Jhb. Can you please send me a info about when wil constructions start them and where wil be build. Where can I register for it?
Hi Loraine. Your best bet is to contact the National Housing Finance Corporation on 011-644-9800. They’re responsible for identifying the pilot projects that will be part of the FLISP subsidy scheme.
I would luv to know if m family will have our house in this new subsidy that the goverment is giving us. We fall in the R3000-R3500. Pls let me know cause we raelly need a house for my family. Very, very, very urgently, urgently…!
Hi Denver. In your income category there are two ways to access the housing subsidy: either you can join a project and get an RDP house that’s being developed, or you can access the individual subsidy (about R88 000) and use that to buy a house on the resale market.
The first option – joining an RDP housing project – will probably mean that you have to wait for some time. Still, you should put yourself on the housing waiting list in your municipality. The second option – using the subsidy to buy a house on the resale market – is more likely in the short term.
Given your income, your affordability for credit is limited, so you will probably have to find a resale house for about R100 000 or so. The subsidy will cover about R88 000 and you’d then have to use savings or access credit to pay the balance. Some older RDP houses may be in this price range however – I heard recently for houses in Delft being sold for R88 000. Please remember: you have to buy the house formally, and you must get the title deed as part of the sale process. RDP houses cannot be sold for the first 8 years after they’re first built. Some of the houses in Delft are now older than 8 years and so they’re available for sale. If you happen to find an RDP house that someone wants to sell before the end of the 8 years, you can apply to the Province for an exemption.
I’d recommend taking a look at any RDP settlements that are in your area and ask if the people living there know of any houses for sale. Then find out if the house is older than 8 years. Once you establish that it is legal to buy the house, you need to find a conveyancer to make the sale happen legally. The provincial housing department should be able to help you with that.
Hi thank u 4 ua reply,Do u know where can I apply for government rental house in Gauteng?
Hi Martha. You could ask the Gauteng Department of Local Government & Housing – you can call them on 08000 46873 and ask them which social housing companies operate in Gauteng. In Johannesburg, enquire with the Johannesburg Social Housing Company. JOSHCO caters predominantly for individuals earning a household income between R1 500 – R7 500 per month. Their website is : http://www.joshco.co.za/ The other rental housing company to check with is the Johannesburg Housing Company – http://www.jhc.co.za/
Hi there I am earning R4500 per month, and would like to know if I would be able to get a subsidy for a serviced stand? and how do I go about it? I have also contacted the NHFC and was told to ph back in June for Northen cape area, any suggestions, wouldnt it be easier to just apply for a subsidy to get a serviced stand and build a house, also is this open to anyone as I am white?
Hi Tasha. In principle, given your income, you should be able to get the subsidy for the serviced stand. There is no racial restriction on the subsidy – qualifying criteria require you to earn less than R7000 (for the serviced stand option), have financial dependents, and to have never owned property before, among other factors. Its not clear, however, whether the various provinces and municipalities are planning to deliver these any time soon – the clause in the subsidy policy is rather vague. You may have to be a bit of an activist in your area. Call your provincial housing department and also your municipal housing department and ask them how they are going to respond to this clause in the subsidy policy and whether (and how) you can apply. Let me know how it goes – I’ll be interested to hear.
Hi Kecia
If i found a RDP house that is more than 8yrs $ the owner is selling that house i can buy it in another words, am i going to get a flisp subsidy or not because its not a new house? secondly if i buy a side from the owner am i going to get a grant also or not.
Hi Kecia
Im still waiting for my answer
Hello Junia. The FLISP subsidy today only applies to new housing that costs less than R300 000 and is in approved projects – so no, you can’t use the subsidy to buy an RDP house that is older than eight years. Yet. I hope that in future the subsidy policy will be revised to enable you to make such a purchase, but at this stage you can’t. I’m sorry. The stand situation is, I believe, much the same although the policy is not as clear in this regard. I would take the details of the stand that is for sale to your municipality, and bring it to them together with the policy document – you can download it here http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ Highlight for them section 5 on pages 7 and 8, and see if they would give you a subsidy for your stand purchase. I suspect they wouldn’t – they haven’t got the systems and procedures worked out for this type of approach. But let me know how it goes. I’d be interested to hear. Thanks for your patience in waiting for a response. Kecia
Kecia what about some one asking subsidy according to her monthly income but purchase a house of her own choice, meaning it is up her how to pay the balance. For instance you earn R10 000 but you want to purchase a house of R450 000. then they give the subsidy of a R300 000 purchase, you self see to it that you pay the balance of R150 000 as we stuggling to get houses of R300 000 from where we live , houses are expensive .
Busi, your point is valid, but unfortunately that’s not how it works. Government is trying to encourage developers to build houses for less than R300 000 and so they’ve imposed this restriction on the FLISP to encourage developers to target this market. It may take some time, but eventually they hope that new houses will be built in this lower price category. In the Finance Minister’s Budget Speech a few months ago, he also announced that a tax incentive would be offered to builders who build housing for less than R300 000. This is all part of government’s plan to make sure that cheaper housing is delivered. I know it sounds crazy, but if you want to buy a house for R450 000, you’ll have to do it without the subsidy. Once the subsidy is broadened to also be applied to the resale market it will make more sense -then you’ll find that lots of existing housing on the resale market is cheaper than R300 000.
hi, in earning 9600 a month, would like to apply for the government subsidy, how much would i qualify for and how should i go about applying, how long will the whole process take
Hello Sibongile. You can read through these comments and the policy document itself for the detail (go to http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/). Your best bet is to call the National Housing Finance Corporation and ask them for the official line: 011-644-9800. I suspect the process will take much longer than you like. As I mentioned in my post, they are only implementing the subsidy on a pilot basis – so only one project per province.
would like the process of applying for the subsidy, step by step
Hi, I want to know that If I am earning 15500 per months which include housing,danger allowance, but without danger allowance and housing allowance is 14300.Do I qualify and if I qualify why because when you introduce this scheme the 800 housing allowance will not paid to me.
Hi Livhu. At R15 500 per month you’re earning too much to qualify for the subsidy – for the FLISP subsidy, the limit is R15 000 household income per month. Please note – I am not a representative of the government. The CAHF is an NGO that, among other things, tries to make information about housing financing transparent. Your best bet would be to call the NHFC (011-644-9800) and ask them how this scheme relates to the R800 housing allowance that you are referring to. I would think the two are separate, but you have to check. Perhaps HR might also be able to help you?
By refering to household income, you refer to joint income (husband and wife) ?
Yes, that’s right Cornel. Household income is all the income earned in the household – so what is earned by husband and wife, or co-habitors, together.
Hi kecia
Thank you for you information nw my question is if you earn net 10200 and after deduction its 7000 including monthly expenses how much subsidy do you qualify for and is it likely for the bank to grant you a mortgage loan in this situation and perhaps what can make your application not to be approved especially if you are saving a lot of money from your salary monthly?
Hi Ntsiki. I think the qualifying criteria judge you by your gross salary. You can look at the subsidy tables at the back of this document: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ I don’t know if the bank will grant you a mortgage – it all depends on your credit rating, whether you have any other outstanding debts, and what your expenses are. Take the information of the FLISP subsidy with you to the bank and speak with a loan officer. They’ll help you figure out how much you can afford. If you have other questions, you can also call the NHFC on 011-644-9800. Good luck!
I have a house value @ R20 000 in a township that was donated to me by my mother, its not much but a RDP HOUSE in a very large plot, I earn R3000 pm whats my best option hear, will I be penalized for this house that was donated to me, or is the a way in which I can access this subsidy and develop this property into a better one?
Hi Sandi. First of all, the RDP house donated to you by your mother is worth much more than R20 000! At simple replacement cost it could be worth anywhere between R80 000 – R150 000. Where the plot is also affects the value – if you’re in Cape Town or Johannesburg, its likely to be higher in value than if you live in a smaller town. To some extent, the value of RDP houses is also impacted upon by the way that the buyer would finance the purchase – so, if you were to sell the house to someone else, and if they were to get a subsidy to buy it, that would be the price. Your question about whether having this house penalizes you in getting another subsidy is interesting: this is an asset, and a benefit in and of itself. When you received the house from your mother, did she transfer her title deed to you, and was this done legally in the deeds registry? What I’m asking is, are you the legal owner of the house? If yes, then you won’t be able to access another subsidy. The subsidy is only for people who have never owned a home before. If no, then perhaps you could apply for a subsidy. You will need to check with your local authority, I think.
please help me apply for a subsidy
Hi Tasleema. I’m not a government employee- I just try and put information onto this website so people have information to address their housing needs. If you earn less than R3500 household income per month, you should go to your local municipality for help. If you earn between R3500 – R15 000, you can contact the NHFC for help. Their phone number is 011-644-9800.
Will blacklisted people benefit from this project?
Hi Thembelihle – the FLISP subsidy can only be accessed together with mortgage finance. That’s just how it works. If someone is blacklisted they need to resolve their situation before they can apply for the subsidy. This means they’re going to have to repay their debt and get themselves into good standing.
hi
me and my husband salary all together comes up to R10 000-R12000
that is now without expenses and his father wants to sell his house to us but its difficult to get the money with our budget and a family to sort out and the house is way behind in debt can we go for this subsidy and how,where,please help
Hi Gina. The subsidy can only be used to buy a new house that costs less than R300 000 and is part of a project approved by the NHFC. While the government has said that they’d like to extend the application of the subsidy to existing houses for sale on the resale market (like your father-in-law’s house), this is not how it works at the moment. While you should be able to qualify given your income, you couldn’t use the subsidy to buy your father-in-law’s house. I’m sorry.
Simple – the people who make decisions do not suffer the inconveniences of not having a home – why should they care who sleeps in th rain!
Get the government to pay the price of 2 house and build one decen one and you will not have to break down 50% of what is built because the are a danger to humanity.
Perhaps someone shpould tell them how it really works – I truly think all the misery is brought about by the fact that” they dont know that they dont know”
I own a NHBRC approved alternative building technology which will sort out many housing issues, the problem is I am white – they would rather have tumbe downs built by the unqualified.
Should there be interest out there from ANY South African
who truly wants to solve the housing issue in the GAP market talk to me please if you are sincere we have something in common.
Hi kecia my nett salary is R3600 if they give me aplot for free will they give me the subsidy money to build and how much will the sub be
Denver, if you access the serviced plot, you won’t get additional funding to build a top structure. You’d need to save or access microfinance to build your house step by step incrementally. Call your local municipality or the NHFC for more information.
My gross is 6000 how much wil I qualify for? For the subsidy
Hi Kecia
If the y say the subsidy is for people earning betwee R3 500 and R15 000, do they mean after they have been taxed or not? In my my case i earn R8 500 but my nett is R7 500.
Hi Khanyi – as I understand it, your eligibility is calculated on gross income. So, in your case this would be R8500. But call the NHFC to be sure: 011-644-9800
tell how can me and my husband apply for a loan at any bank since we are both blacklisted and we would really like to own a house please help us cause we are not the only pleople that have this problem there are a lot of families that must stay in back yards and keep up with the demands of other people so please help us as well
Carmen, you have to resolve your credit situation before you can apply for mortgage finance to buy a house. The National Credit Regulator offers a useful brochure on managing your finances, which also discusses how you apply for debt counselling – you can download the brochure from here: http://www.ncr.org.za/publications/brochure5.pdf The only way you will ever be able to access a loan to pay for your housing is if you pay off your other loans. Please start today. I know its hard but you have to do it if you want to own your own house.
Good day
I earn less than R2500 and wants to buy a house with my brother and sister. This is an excisting house and worth between R380000-R420000. Will I still qualify for a subsidy if I buy like this? My sister earns less than R13000 per month and is thinking about applying for a pension backed loan for her share.
Hello Lolla. You could certainly buy a house together with your sister – however your combined income puts you beyond the eligibility for the FLISP subsidy. Only households earning less than R15 000 COMBINED can apply for the subsidy. By herself, she would be eligible to access the FLISP subsidy – although she’s quite close to the upper threshold so the amount would be less. If she were to access that subsidy, she would only get it if she were buying a new house for less than R300 000 in an NHFC-approved project and with mortgage finance. It doesn’t apply if she accesses a pension-backed loan. If you have dependents, you could apply for the RDP subsidy but the queue for that is very long.
I want to know when i buy Rdp house will nhfc pay for me that house and im earning 8000 my problem is credid berue and i wont qualify for bond.
Hi Sanniah. At R8000 you would be able to apply for the FLISP subsidy, which would be an amount of money that you would add to your bond and use to buy a new house costing less than R300 000, in an NFHC-approved project. You can’t access the FLISP subsidy if you can’t qualify for credit – the two have to go together. There seems to be quite a lot of demand for the FLISP subsidy so I think even if you could access it, it would take some time. Use this time to resolve your credit situation – pay back your debts, clear your name with the Credit Bureau, and start saving, so when the housing situation gets better and there is more supply available, you will be ready to participate.
Good Morning
Iam a 40yr old woman and I earn 10000 before deductions my question is do I qualify for FLISP subsidy and if I qualify what are the procedures for applying?
Hello Ivy. Given your income you should qualify. The administrating agent for the subsidy is the National Housing Finance Corporation. Give them a call on 011-644-9800 and ask them how it works. Unfortunately access to the subsidy is constrained by the availability of houses – but see what they say about houses being built in your area that qualify for the subsidy.
21 years..i would like to buy my fathers house with my goverment subsidy but i would like what do i need to qaulify and where should i go
Zintle, you can only use the subsidy to buy a house in a new project, that costs less than R300 000 and which has been approved by the NHFC. At this stage, the subsidy cannot be used to buy existing houses. If you want to buy your fathers house, you won’t be able to access the subsidy. You can call the NHFC for more information: 011-644-9800.
Hi,I would like to find out if I buy a land and build my own house will I still qualify for the housing subsidy.
Hi Terence. According to the policy (http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/) households earning R3501-R7000 can apply to get a free, serviced stand, and then you can build your own house on that. With that approach, the subsidy would cover the cost of the stand and you would have to finance the building of your house. If you earn more than R7000 but less than R15000 however, you would have to access the subsidy through the standard process – buying a new house that costs less than R300 000, in an NHFC-approved project. There are a lot of people who fit into this circumstance, and I don’t think there are many such projects or houses. You need to call the NHFC for more information: 011-644-9800.
My Gross income is 9900, and net pay is 8280. Do I qualify for a subsidy.
Hi there. According to your income you should qualify, but there are other criteria as well so you would do best to check with the National Housing Finance Corporation (NHFC) – you can call them on 011-644-9800. To access the subsidy you would have to buy a new house in a project that has been approved by the NHFC so it is important to check with them. At this stage, you can’t use the subsidy to buy any house on the market. Hopefully this will change in the future, but in the short term this is how it is.
Can existing homeowners also apply? We have our bond for a year.
Dorothy, the subsidy is only available to first time homebuyers, currently buying a new house in an NHFC-approved project. I’m so sorry, but existing homeowners cannot apply. On the upside, the Reserve Bank decreased the interest rate by 0.5% last week so that should be helping a little.
Hi Kecia..im in desperate need of a house i earn under the set amount which is R2500pm. I have 3 dependants. What options could i look at for the amount i earn. I currently been looking through the Subsidy website but none make sense to me would you mind steering me in the right direction as to optaining a house..With the little i get i do not mind paying abit towards a house for my kids.
Awaiting your favorable response.
Hi Gloria. I know the subsidy website doesn’t make much sense… its a real pity. At your income, and given that you have dependents, you should qualify for an RDP house. I’m sure you know from the news, however, that there is quite a long queue for these houses. You need to contact your local municipality on the telephone and ask them how they allocate houses in your area. Also ask them how long the waiting list is. There is one other option, although its not so common. In some municipalities, you can access an individual subsidy (this is worth about R88 000 or so) which you can use to buy an existing property, like an RDP house that has been around for more than eight years. If you find a house in your area that is for sale, perhaps you can follow this route. Please remember that in order to get the subsidy you have to buy the house legally – that is, you have to get the title deed in your transaction. I hope your municipality can help you further.
Hi Keisha
I would like to know if I do qualify for a subsidy. I eern R6400.00 per month. I also want to know if I can use the subsidy to buy an existing RDP House which is older than 8 years. At the moment I am renting a flat of R1800.00 per month. I know that I am not creditworthy.
Hello Angie. At R6400 per month you should qualify for the finance-linked individual subsidy, but in order to access it you must link it with credit. If you are not creditworthy at this stage, this approach won’t work for you. The other option you have, according to the policy (though I’ve not yet seen it done) is to access a serviced stand. People who earn R3501-R7000 can apply to their municipality to get a serviced stand instead of the financial subsidy, and for this you don’t need to link it to credit. Even if you were creditworthy, however, you wouldn’t be able to access an existing RDP house – the programme is only available for new housing at this stage.
Hi Kecia,
As i understand it from snippets of information read, to qualify for the subsidy you should be a first time home buyer and under a certain income bracket also the area in which you’d qualify for subsidy must be within a Provincial based housing project however i’ve phoned NHFC to give me a list of area in Gauteng that forms part of the Provincial Based Project and they’ve informed me that they currently none in Gauteng and I Specificly named Cosmo City if it’s part of the programme they responded with a no. As far is they are aware there only two provinces in the country that do have such projects. do you perharps have more information on this projects, i thought when the subsidy was mentioned by the president in Febraury that it would be available from April that was would have been the case it seems like that’s not please tell me, i’m wrong. would appreciate your response.
regards Lerato
Hi Lerato. You’re understanding the situation perfectly. The current FLISP subsidy that was announced by the President in February and promised for implementation from 1 April is only available in new housing projects that have been approved by the NHFC, where the houses cost less than R300 000. According to the policy, it is the responsibility of the NHFC to “i) Standardise, streamline, align and centralise all the processes around the planning, negotiation and administration of the Programme; ii) Introduce a “one-stop shop” to work with Provincial Departments, financial institutions and property developers and other role players regarding the implementation of the Programme; iii) Enter into appropriate legal arrangements with MECs to act as the implementing agent for the Programme in the relevant province for the administration and disbursement of FLISP subsidies. … and iv) Conclude agreements with lenders and other role players to enable the implementation of the Programme on a project basis.” For this they get a special budget allocation from the Department of Human Settlements. You can download the full policy from our website, on http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ It is therefore the NHFC’s responsibility not only to know of projects that align with FLISP, but also to find such projects. They should also be communicating this widely. I am very sorry that there are such delays. The best thing you can do is keep on calling them and pressurising them to respond as they are required to do. I wish I could be of more help.
Hi Kecia
I want to know what about those people who earn R2500 per month,because before the housing subsidy was for the people who earn from R0-R3500,so what is going to happen to them if they also need the subsidy? or is there any help they can get in order to be qualified?.. Or this means people who earn R2500 do not qualify at all if i am not mistaken.
Thanks!!
Ncumisa
Hi Ncumisa. Don’t worry: the RDP subsidy still exists! It works like this: households earning less than R3500 per month, and who satisfy a range of other criteria, can apply for an RDP house. Households earning more than R3501 and less than R15 000 can apply for the Finance-Linked Individual Subsidy Programme. According to your income, you should be able to apply for the RDP subsidy. To do this, go to your local municipality and ask them about how to apply, and about the status of their waiting list. I should warn you – the waiting list is pretty long in many cities, but depending on where you live, you may find an opportunity.
I am currently earning R 4150.00 like to know if I qualify for a housing subsidy? Please advice me on how to go about having that information, because I need a home so desperatetly, have kids with no home.
Idah, with your income you should be able to apply for the Finance-Linked Individual Subsidy Programme. However, because the subsidy must be linked to finance, you also have to earn enough to afford mortgage repayments – and unfortunately at your income that is probably unlikely (though, you should check with your bank to be sure). The FLISP subsidy has an exception, however, specifically targeted at households earning R3501 – R7000. Households in this range can apply to get a serviced stand, for free and without credit, from their municipality. I’m not sure if any municipality has implemented this exception however. You should download the policy on this website (http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/) and take it to your municipality and ask them if they are going to implement the approach set out on page 7, section 5, entitled “Special Provisions for Qualifying Beneficiaries who are unable to obtain mortgage loans”. You can also call the National Housing Finance Corporation and ask them if they have any information on how this will work in your area. Their number is 011-644-9800. Good luck, and let me know how it goes!
thanks for the information i got from your website and now i know that it is not only me who is frustrated by this present policy that affect us directly.big up for the effort. i guess most of the budget allocated for this will go back unused because of the red tape. i was happy when the announcement was made on budget speech but now i am downn to earth.
I would like to know.I all ready purchesed a property but would allso would like to benefit from government subsidy like flip
Hi Chris. I’m sorry, but the subsidy only applies when it is accessed at the point of purchase: it does not work in retrospect. I understand you’d like to benefit from the subsidy, but the waiting list for that is so long, you’re probably better off having your house now. Good luck.
Hi, I earn R15 000.00 have a house, but needs to extent will flisp apply to me as well.
Is the flisp part of Dora allocation of a Municipality.
Hi Shirley. I’m afraid the FLISP does not apply to you. It is only available to households who earn less than R15 000 and who have never owned a property before. It does not apply retrospectively. Yes, the FLISP is part of the housing subsidy allocation to the municipality – as I understand it, municipalities choose the proportionate allocation between RDP housing and FLISP subsidies.
What help is there for a domestic worker who earns LESS THAN R3500.00 PER MONTH? IN TERMS OF HOUSING( SHE HAS APPLIED BUT THERE SEEMS TO BE NO SYSTEM IN PLACE) AND IN TERMS OF A LOAN?
Hi Christine. Households who earn less than R3500 per month can apply for the RDP housing subsidy – but you’re right, there’s a very long waiting list. In some cities, the wait has been more than ten years. The best bet is to contact your local municipality and ask to know where on the waiting list you are. Depending on your income, you should be able to access finance – whether a small mortgage, or a housing micro loan – but the amount that you would be approved for is likely to be too little to afford even the cheapest housing. One option that can work in some municipalities is the individual subsidy. In terms of this programme, you could get an individual subsidy (its about R80 000, depending on the municipality or province) to buy a house on the resale market. I know that in some areas, there are houses that sell second-hand for less than R150 000. Ask your municipality if they offer this option.
I wanrt to apply for a house what must i do and where to get the forms because the web adress of housiing finanfe africa is not working i’m earning 9,200 monthly
Hi Bongiwe. The National Housing Finance Corporation is the administrator of the Finance Linked Individual Subsidy Programme, so they should be able to give you the application details. Call them on 011-644-9800.
How much does my husband qualify with R4200.the price of the rdp house is 75.000.how long does the subsidy take.
Hi Monique. If your household income is R4200 you should qualify for about R82 000. You can download the whole policy document from this website: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/ However, I’m afraid you can’t use the subsidy yet to buy an existing house. According to the current policy, you can only use it to buy a new house that costs less than R300 000 and which is in an NHFC-approved project. At an income of R4200 per month, however, its unlikely that you’ll qualify for the R218 000 mortgage that you’d have to get in order to buy a R300 000 house. For this reason, the policy also includes a section for people earning less than R7000 per month, which says you can apply for a serviced stand instead. Call the NHFC and ask them to explain this process to you. Their number is 011-644-9800. Good luck.
would i qualify for a subsidy to renovate my late mother’s RDP house in free state? i’m a housekeeper earning 5900. what advice would you give me. i’m single and have no kids. i really want to improve the house bacause that’s my home. the banks won’t give me a loan.
Hello Dipuo. I’m afraid there is no subsidy to assist you in renovating your late mother’s RDP house. If you’ve formally inherited the house (if the title deed is in your name) you will not be eligible for any subsidies as one of the criteria is that you have never owned property before. However, depending on what other credit you have outstanding, you could be eligible for bank finance. If the property is in your name, you could apply for a mortgage loan. A better option might be a smaller micro loan, however, that you could use to build your house incrementally, step-by-step, in a pay as you go sort of way. The faster you pay off the microloan, the cheaper it is, because of the interest. If you don’t legally own your late mother’s house, and if you’ve never owned a property before, you could apply to the NHFC for the Finance Linked Subsidy, but there is such a queue and supply is so slow, this is unlikely to give you a house any time soon. Better you renovate the RDP house. Depending on where you live, there are some microlenders who specialise in housing. If you visit the Rural Housing Loan Fund’s website, you can get the details of a housing microlender in your area: http://www.rhlf.co.za/lenders.php
Hi There
i am a commision earner with a basic of R3500 do i qualify for the full amount of R87000 or how does the calculation work?
and my 2nd question which development i can choose from in cape town?
many thanks
Hi Sinazo. I’m not sure how the affordability calculation works for commission earners – you’re raising an interesting question. I suspect they’d take your last three months earnings or so and take the average? Please call the National Housing Finance Corporation (NHFC) and ask them how it works – they’re the administrators of the scheme. The number is 011-644-9800.
Hi there
My husband i would like to know do we qualify for housing subsidy and our income together is 11670pm
and how and where should wego to apply please
Hello Mishka. At your income, yes, you are eligible to apply for a Finance Linked Individual Subsidy (FLISP). The administrator of the subsidy is the National Housing Finance Corporation, so you should call them first and they’ll give you all the details: 011-644-9800. The FLISP subsidy can only be accessed together with mortgage finance (so you will have to qualify for a mortgage loan with your bank), and can only be used to purchase a new house costing less than R300 000 in a project that has been approved by the NHFC. I know there’s quite a lot of people trying to access the subsidy, so please be patient – it may take some time.
Hi Kecia…
sometimes it is so difficult to get full info from our local municipality as sometimes we are living in the rdp houses close to developed houses, when we go to them for assistance they refer you back to your area councillor and belive me Kecia councillors dont give a heck. My point is how exactly would you find out what vacant land is there and what houses are built linked to the scheme?
Hi Ongi. I fully appreciate the difficulties you are facing… Of course, we do know that our municipalities are under terrible pressure to address very many needs, and the FLISP opportunity for a serviced stand is a new policy. It is possible they’ve not yet developed the necessary administrative arrangements to implement the policy. In principle, it should be the housing department within you municipality that should be helping you – and not the councillor. This is an administrative and not a political issue. If you’re happy to tell me the name of the municipality that you’re in, I’ll see if I can contact them. Have you tried calling the NHFC? They should be overseeing this whole programme. Their number is 011-644-9800.
Hi wanna know if i can still qualify for the subsidy,Because i earn R4500 per month.and i already qualify by the bank for the house.
Hi Elfredo. The subsidy is only available if you have never owned a house before, and if you use it together with a mortgage to buy a newly built house that costs less than R300 000. Your income is within the eligibility range, and its great you qualify for a loan, but if you want to buy an existing house (not new) then you can’t get the subsidy.
Hi Kecia,
I’ve noticed that most of the concerns and question raised on the blog is about access to required information from NHFC regarding how do the FLISP subsidy works and availability of housing projects to the value R300000 or less in municipalities one may reside in, linked to the project and how an individual can proceed in applying for a subsidy once having had an access to that information. obiviously having been pre approved for a morgage bond.
Can you perhaps pose these question to the NHFC alerting them to lack of access to information and may be they should be aware of these blog so they can see how many people are in need of homes. I’ve phoned and i could’nt get required answers on question asked. specifically on areas in Gauteng falling under FLISP. I would also wonder how many people have phoned the number 011 644-9800, have received satisfied answers great blog.
thanks.
Hi Kecia,
Just to add on my previous comment i think all major banks offering homes loan finance, they should have information on FLISP readily available same way as they have on their various product offerings.
thanks.
Hi Lerato – I have been planning on bringing all of this to the attention of the NHFC and National Department – and your suggestion about the banks is also a good one. I did speak with NHFC a few months ago, but will do so again. One of the problems that everyone faces, however, is that the design of the policy instrument itself – focusing in the short term just on new-build, and requiring projects to be approved by the NHFC – is bound to create blockages and delays. When the President announced the scheme in his State of the Nation Address in February, it sounded like the money would flow from April. But that’s only when projects started to be approved – and houses take years to build. Its hard to be transparent when you’re not delivering the news your audience wants to hear. I’ll keep you posted.
Hi, I earn around R4.600.00 after deduction & i’m Blacklisted. I bought a stand, have building plan ready & got a qoute for R60 000.00 for building material. i do have dependants & want to build a house. How can i go about receiving assistance through FLISP. where can i also get these application forms.
Hi Percy. I’m impressed how far you’ve gotten with your housing process. Unfortunately, the FLISP does not apply to building materials, and you can’t get the FLISP if you already own property – even if its just land. You’re going to have to do this on your own. Still, you’re a lot farther than many people so don’t lose heart. If you’re blacklisted, you’re not likely to get the full R60 000 from a lender – but have you thought of splitting up your construction plan into more manageable phases? There are some organisations that can give you advice in this regard – Habitat for Humanity, for instance, or even one of the Rural Housing Loan Fund’s housing microlenders, should be able to tell you how to build your housing in phases. Also, you should start addressing your credit situation to clear your credit record. Save and pay off a little every month. If you let me know what province you’re in, I can give you the name of some organisations to contact for help in your house-building process.
Hi Kercia, thank you for the response & advice. I’m in the Vaal, Gauteng province. Building the house in phases was something I thought about & it will work out cheaper too. please furnish me with a list that could assist & thank you again.
Hi Percy. I’m trying to find which organisations might be there to help you – in the meantime, take a look at the Rural Housing Loan Fund’s website: http://www.rhlf.co.za.
Hi Kecia, Our combined salary is R7000, I just want to know do we qualify for Subsidy houses?
Hi Lydia. In principle you should qualify – it all depends on whether you have never owned property before, if you can access a mortgage loan to pay the difference, and if the house you find is approved by the National Housing Finance Corporation and costs less than R300 000. The subsidy you get is only part of the cost of the house, and in order to get it you have to qualify for mortgage finance as well, which is then linked to your subsidy to buy the house. The NHFC is the administrator of the scheme and they also have information on which houses can be bought as part of the programme. Call them on 011-644-9800
Hi Kecia,my husband and I earn a joint income of R 11,500 and I would like to know regarding this government subsidy how do we go about getting it and we would like to apply for a house next to where we work and our children are schooling,Cosmo city part of this programme?
Hi Rachel. Yes, at your income you should qualify for the FLISP subsidy and for mortgage finance. I’m not sure if Cosmo City is part of the programme – but it only applies to new housing built in projects approved by the NHFC and where the housing is less than R300 000. As you would imagine, there’s quite a long queue. Call the NHFC and ask them for the details – they are the administrators of the subsidy programme. Their number is 011-644-9800. At the moment, the subsidy does not apply to the purchase of existing housing on the resale market. You may find that you can get housing for cheaper on the resale market – in which case, you may wish to forgo the subsidy to get the house you want.
Hi there im earning R4500 per month. I want to apply for a subsidy, but i was at my local Munisipality and they told me that I have to wait until November 2012. According to them this new subsidy rule will start this november. I have a house that I can buy, the seller ask me only R80 000 for the house, and according to the subsidy parameter i qaulify for R80 250.00. tell me do i have to wait untill November 2012 or what. Please assist me on this
Hi Shaun – I’m trying to find out the answer to your question. November may well be when the subsidy amounts are revised – this happens annually in line with inflation. Or, it could be the date that your municipality has decided to start wit the implementation of the FLISP. As far as I know, the FLISP doesn’t apply to resale stock, however… it will in the longer term, but in the short term they were restricting this to new housing. But maybe this is changing. I’ve left a message with the NHFC for them to contact me, and will try them again – I’ll get back to you as soon as I know.
Hi Kecia, Im in the process of buying a house but I already went to the bank for a home loan. I’m buying the house for R140 000-00. I want to know if I can still apply for a house subsidy to pay the bank or did my chance gone by… please let me know.. im 21 years old getting married soon. the repayments is for 30years. will the state help me with this one.?
Well done, Shaun, for finding a house for R140 000. I’m afraid you can’t access the FLISP subsidy however – not because you’re too late, but rather because the house isn’t newly built and approved by the NHFC. You know, if you pay a little bit more on your repayments (this is something you could start in a couple years, when your income improves) you can dramatically reduce the number of years you need to repay your house for, and the interest you will pay. But at this point, feel proud for what you’ve achieved. Well done.
Incredible points. Solid arguments. Keep up the good work.
Hi,am earning a monthly income of R9750 a month.Do I qualify for a house at the newly devopment at fleurhof?
Euginia, with your income, you should certainly qualify for a FLISP subsidy – and the Fleurhof houses are all less than R300 000, both full title and sectional title units. So, if you also qualify for a mortgage on your salary and given your credit situation, it is likely that you could have enough to purchase a unit at Fleurhof. HOWEVER, I’m not sure how the subsidy applies to existing developments. According to the NHFC, they have signed agreements to implement the FLISP in 8 of the 9 provinces – so I suspect Gauteng is one of these. But they have not yet disbursed any FLISP subsidies and I don’t know if they’ve reached any agreements with any of the developers yet. I recommend you call them and ask them if you could apply for the FLISP to buy a house in Fleurhof. In principle, they should be able to do it, but I’m not sure if they’ve sorted out all the administrative arrangements yet. Let me know what they tell you. I’d be interested to know.
Hi Euginia – to find out more about Fleurhof, you can call Wendy Cater at Calgro. Her number is 079 512 8066. The Fleurhof development is in part financed by International Housing Solutions. They’re planning on updating their website to include marketing contacts for all of their projects that are marketing units for rent and/or sale. You can visit their site on http://www.ihsinvestments.co.za/ – keep checking back as they update it.
Hallow i just want to know if my husband can qualify for an subsidy house,we desperately looking for a house even if its a rent to own he gets R1300 every week and he is permanently employed, clear credit record pls assist urgently
Hello Fundiswa. If your household income is above R3500 per month but less than R15 000 per month you certainly can apply for the FLISP subsidy. This is a subsidy that you use together with a loan to buy a house that costs less than R300 000. The National Housing Finance Corporation (NHFC) is administering the subsidy, and they should be able to tell you what to do. You can call them on 011-644-9800. However, I should mention that the scheme really hasn’t started yet. Even though it was officially launched on 1 April 2012, they haven’t yet disbursed any funds. I’m about to write another blog on this subject so please keep watch on the website.
pls assist me i need a house and my husband is getting R1300 after deduction and i just want a house or Rent To Own pls
Hi Kecia
My income is R4700 net & i`m repaying a bank loan R1300 monthly, i`m desperately need a stand or a house currently renting in Tembisa & also renting for my siblings which are not working please help me which is the fastest way to take in order for us to have a home or a stand around Tembisa or Daveyton
Simphiwe, I suspect that R1300 loan repayments per month is the most you can manage. Can’t you pay off that loan first? Put your name on the list for a stand in your area – in terms of your income you should qualify for a serviced stand, however I’m not sure if the municipality has implemented that part of the programme yet. But pay off your loan because its unlikely you’ll be able to access any more credit until you do. Good luck.
Hi Kecia
My cousin sister has 2 kids, she is working only 6 days a month in Gauteng and renting a back room, her mother at home is staying in an RDP house which is on my cousin`s name how is she going to get an RDP house for her own in Gauteng please help!
Hi Nomsa. If the RDP house in which your cousin’s mother is living is in your cousin’s name, then she can’t get another RDP house. People are only allowed one RDP house per household, ever in their lifetimes. However, maybe she could build a second house on the same property? She should should make sure with the municipality what the boundaries of her property are – and then if she builds on the other side there’s a chance in future that she could subdivide her stand into two halves.
hI All
Pleaase assist me with the subsidy house im staying with my In laws at the backyard i have two Kids Husband Ineed a house for my kids we are suffering.please advise what must ia do from here. if it is a low coat house it is fine.
Thanks ‘DAPHNE MMOTA 0733472771
Hi Daphney. If you and your husband together earn less than R3500 per month, then you can qualify for an RDP house. If you earn more than that but less than R7000 you can qualify for a serviced stand from your municipality, although I don’t know if they have a programme yet in place. The Finance Linked Individual Subsidy Programme applies to people who earn between R3501 – R15 000, but you have to qualify for a mortgage bond in order to get it. I’m afraid its being implemented VERY slowly at the moment, however – not much is happening. You can call the NHFC for more information – they’re responsible for implementing the scheme: 011-644-9800.
Hi im Themby im a mother of two renting a back room im working earning R5000 my boyfreind his a taxi driver and im blacklisted do i qaulify for this and what are procedures and which banks we go to please help.
Hi Thembi. I’m sorry but in order to access the subsidy you have to qualify for a loan, and you can’t get a loan if you’re blacklisted. What you need to do is resolve your credit situation: pay back all your debts and start saving for a deposit. Then you can clear your blacklisting (its not forever if you pay back your debts) and then you can get a loan and the subsidy. You do have some time – they haven’t started giving out the subsidy yet and it will be some time. If you go to the National Credit Regulator website, you can also find out about debt counselling: http://www.ncr.org.za. Good luck!
I want to know , i need a house which cost R345000 , how do i apply for that .
Hello Azwindini. If you earn less than R15 000 household income per month, you are eligible to apply for the Finance-Linked Individual Subsidy Programme, however you can only use this to buy a new house that costs less than R300 000. If you are set on the R345 000 house that you’ve found, you will have to forgo the subsidy and rather just apply to a bank for mortgage finance. For more information on the subsidy programme you can contact the National Housing Finance Corporation 011-644-9800.
I would like to know that will my husband qualify for FLISP programme he’s self employed & roughly makes R5000 monthly but sometimes its a dry season as you know business is fluctuating & I get R3300 monthly
Hi Nonhlanhla. In principle, your household income of about R8300 should make you qualify for a FLISP subsidy, as well as for the mortgage finance that must go along with it (assuming you have no or little other debt). However, it is possible that if your husband’s income is informal, your loan affordability will only be calculated on your formal income. The best bet is to bring all of your details to your bank and ask them: bring three months bank statements, your contract of work, and evidence of repayment capacity – for example, a cellphone contract, or utility bill that you pay without falling into arrears. They’ll then explain to you how they would approach your individual situation. I should say that the FLISP programme is very slow in being implemented and there are very many people who want to apply. With your income you may find it more efficient to find a house on the resale market for sale and just buy that – you might find something cheaper than a new house, and even though the subsidy doesn’t apply, it might be more affordable to you.
Hi. Kecia.. We have a combined monthly income of R 10000… I would like to know the following: would we qualify; where do we go about applying for this if we did and also how do we know iff the house we choose will allow us to utilise this subsidy?? Is there a site where more info can be obtained? Who can we contact in the kzn area? Many tnx
Hi Cheryl. I’m sorry there’s not a central website where you can get more information. In principle, with a household income of R10 000 you should qualify for the Finance Linked Individual Subsidy Programme (FLISP) – that is only if you also qualify for the mortgage loan you will need to finance the rest of the purchase price, and only if you buy a newly-built house costing less than R300 000 in a project that has been approved by the administrator of the scheme, the National Housing Finance Corporation (NHFC). Your best bet is to call them directly: 011 644 9800 and ask them to give you the details of who to call in the KZN area. That said, the implementation of the programme is extremely slow: as I understand it, no one has yet been awarded the subsidy, and only a very few housing delivery projects are currently included in the programme. But there may be developments in your area that I don’t know about so call the NHFC to be sure.
Hi kecia I just want 2 know if I wil qaulify for the housing subsidy if I have a income of R3000pm. This income is without deductions rent is R1050pm,account R400pm and the other money I buy food.so tell me wht change do I have 2 qaulify.advise please
Hi Chris. The RDP housing subsidy is for households earning up to R3500 per month. Applicants need to have dependents (a spouse, or children, or parents) that are part of their household, and income is calculated on the basis of all the money that all members in the household earn per month. If you satisfy all of these criteria, as well as others (you are a resident of SA, and have never owned a house before) then you should qualify for the RDP subsidy and this would allow you to join the waiting list for an RDP house in your area. To find out more about this programme, you need to call your local municipality and ask them about the waiting list, how to join, where there is housing, and so on. The FLISP subsidy is for households who earn between R3500 and R15 000. Its different from the RDP subsidy in a few ways. With the RDP, you get a free house; with the FLISP, you get money towards a deposit on a house – and you have to qualify for mortgage finance to access it. At your income, it is unlikely you’d qualify for enough finance to afford the cheapest newly built house, and the FLISP subsidy can only be used on new houses at this stage. I recommend you call your local municipality and ask them about the application process for the RDP subsidy. Good luck Chris.
I also wanted 2 knw if I qaulify where do I get the application forms what is needed and what is the first thing I must do.advise pls.
I ALSO WANTED IF I QUALIFY TO GET A SUBSIDY AND CAN I GET THE APPLICATION FORMS.
To qualify for the FLISP subsidy, you need to earn a household income of between R3500 – R15000, be able to access mortgage finance, and to afford the repayments for a house costing less than R300 000. You can only use the FLISP subsidy together with a mortgage loan. To find out more you can call the NHFC, the organisation responsible for implementing the scheme, on 011-644-9800
We want to know the subsidy
Hello Whity. I’m not really sure of your question, but perhaps this will help: The RDP housing subsidy is for households earning up to R3500 per month. Applicants need to have dependents (a spouse, or children, or parents) that are part of their household, and income is calculated on the basis of all the money that all members in the household earn per month. If you satisfy all of these criteria, as well as others (you are a resident of SA, and have never owned a house before) then you should qualify for the RDP subsidy and this would allow you to join the waiting list for an RDP house in your area. To find out more about this programme, you need to call your local municipality and ask them about the waiting list, how to join, where there is housing, and so on. The FLISP subsidy is for households who earn between R3500 and R15 000. Its different from the RDP subsidy in a few ways. With the RDP, you get a free house; with the FLISP, you get money towards a deposit on a house – and you have to qualify for mortgage finance to access it. To find out more about the FLISP subsidY, you can call the administrator of the programme, the NHFC: 011-644-9800
Hi Kecia,
I would like to know how come a bond is paid for over 20 years? Can you not pay it in less than that if you feel you can afford to do so? I am asking because I am working on a five year contract as a government employee and I would like to get a place of my own instead of renting. I earn R13399.00 after deductions. Thanks
Hi Thandeka. A mortgage bond is usually structured to be paid over 20 years because by extending it that long, monthly repayments become more affordable, and increasing the amount of money you can borrow. Of course, this also means that the amount you pay in interest is higher – but again, because its spread over 20 years you don’t notice that as much. If you want to pay your bond back more quickly, you should discuss this with your bank. At your income, if you wanted to limit your bond to a 5 year mortgage at 11% interest, you could borrower about R179 373. Increasing the loan term to 20 years would mean you could borrow up to R377 838. Go and discuss your situation with your bank: maybe they will let you change the loan term to suit your contract.
Hi Kecia
Do u know anything relating to the below statement:
People earning R3 500 and R7 500 a month will put them into the so-called social-housing bracket.
While those earning above R7 500 a month but below R15 000 a month will put them into the entry-level bracket.
Its an interesting statement Dee – I’m not sure where you read or heard this? The Finance Linked Individual Subsidy Programme (FLISP) is for households (not people – you have to have dependents) who earn R3501 – R15 000. In order to access the subsidy you need to link it with a mortgage loan to buy a new house, costing less than R300 000, and approved by the National Housing Finance Corporation (NHFC). However, people earning less than R7000 are unlikely to afford the size of the mortgage loan necessary to buy the house, even with the subsidy: if your income is R7000 per month, you could qualify for R63 375. This would mean that to buy a house for R300 000, you’d have to qualify for a mortgage loan of R236 625. At a 9% interest rate over 20 years, a household earning R7000 could feasibly qualify for a mortgage of about R233 000, if they had no other debt. But at R6500 per month income, the subsidy would be R66 760, meaning the household would need a loan of R233 240. If they could get a loan at 9% interest rate (very optimistic), they could only get a loan of about R216 000. So, at about R7000, the math which matches a subsidy with a loan to buy a house for less than R300 000 stops working. To deal with this, the FLISP subsidy offers an option for households earning R3500 – R7000, to access a serviced stand for free from the municipality, without any further cash. Its not clear if any municpalities are actively addressing this however. There is also a rental housing subsidy, called “social housing”, which is for households earning less than R7500 per month. SO, the statement means that for households earning R3500 – R7500, subsidised rental or ‘social housing’ is the most likely option (although there’s very little supply). Households earning more than R7500 start to be able to afford to buy the cheapest newly built housing on the market with the FLISP subsidy – and eligibility for this is for households who earn less than R15 000. Its complicated, but does this help?
hi im earning 4200 a month is it possible for me to get the rent to buy house because im really struggling,my care take is telling me that he wants us out of his building he need to do business,so we going from one place to another because we dont have a place to stay please help
Hi Ntombenhle. It is possible that at your income you could qualify for the Finance Linked Individual Subsidy Programme (FLISP), which is for households earning R3501-R15 000, but the implementation of this programme is very slow so it is unlikely that it will help you in the short term. Rental accommodation in your price bracket is in short supply – although it does exist in some cities. You’ll need to find another place to rent in the meantime. Try to save as much as you can from your income so that you build a good deposit to get a house when your affordability improves.
Hi Kecia
Do you know if we will be able to get our government subsidy if we bought a house some 9 years ago. First time home buyer , bought house for under R 300 000.
Hi Wayne. I’m sorry, the subsidy does not apply retrospectively. I’m glad you managed to find a home to purchase.
Hi, If a property is R200K and you qualify for the maximum subsidy enabling you to purchase the propery cash, how does it work?
Asa, you can only use the FLISP subsidy to buy a new house (costing less than R300 000) that has been approved by the National Housing Finance Corporation (NHFC). You can call them to find out what houses are currently available (011-644-9800). If you earn enough to get the maximum subsidy – that is, if you earn R3500, which qualifies you for a subsidy of R87000 – you would need to finance the remaining amount with a combination of savings and mortgage loan. I don’t know what happens if you’ve already saved the whole balance of the purchase price! That’s a good question to also ask the NHFC – let me know what they say.
Hi Kecia
Do u know when this subsidy will start?
Hi Dee. Its hard to say! Officially, the subsidy policy was launched on 1 April 2012. From this date, the NHFC began entering into agreements with developers, provinces and banks to make all the different aspects of the programme work. It is because of this that the process has taken so very long… these agreements take time to finalise. Earlier this month, the MEC for Housing in the Eastern Cape announced that the first five beneficiaries had been awarded the subsidy: http://www.info.gov.za/speech/DynamicAction?pageid=461&sid=32028&tid=89621 So, the process is slowly beginning to take off. I would recommend you call the NHFC and ask them about the progress in your province and city. Their number is 011-644-9800
I need buy subsidy house. will you send me the details
Hi Daniel. It all depends on which subsidy you’re apply for. If you think you qualify for the FLISP (you earn a household income between R3500 – R15000 per month) then you need to contact the National Housing Finance Corporation. Their number is 011-644-9800. I’ve also recently come across this brochure, offered by the NHFC on their website: http://www.nhfc.co.za/files/FLISP_Brochure.pdf Take a look at that and feel free to come back to me if you have more questions.
Hi me and husband bought a house 4years ago never received a first time home owner subsidy well we have to apply for a bond moving so a lot made my kids unhappy.What make me so unhappy second year into our bond I lost my job as company close and things become so easy for other people here I’m struggling to raise my kids nd paying my bond put food on the table only on my husband salary of less then R5000 a month,is heartbreaking going with the when I’m gonna loose my house nd here others get it easy what about us?struggling!
Hello Mariam. I can hear your frustration – I’m sorry that you’ve found yourself in this situation. Unfortunately the FLISP does not apply retrospectively. Still, you have a few options available to you. You should go and speak with your bank about your financial situation and ask them if they could come up with a temporary arrangement where you “reschedule” your loan repayments to allow for your current affordability challenges, while you search for a job. Depending on the value of your house, you could possibly sell it on the market and then with the amount you sell it for, pay back your mortgage, and have enough for a downpayment for a cheaper house that you could finance with a smaller mortgage that is more affordable. These kinds of things you should discuss with your bank. Don’t let your house go to foreclosure, however – that’s when the bank repossesses your house and sells it for you. One rarely gets the best price in that situation – its much better if you control the whole process yourself. Good luck with your struggle. Please talk to your bank – they need to be aware of what you’re thinking so they can help you.
Hi Kecia
How do we go applying for the housing subsidy, are there any forms to fill or offices to request the papers.
Thanks
Sempie
Hi Sempie. There are forms to fill in – you can get these from the National Housing Finance Corporation. They have a brochure on their website: http://www.nhfc.co.za/files/FLISP_Brochure.pdf Take a look at that and feel free to come back to me if you have more questions.
Hi there.
I raised this matter with the President and was happy when my letter and my situation was known to all south african like me. this does or will not solve the housing problem in this country as long as there is a criteria for one to benefit. As a state employee who earn more that the stipulated amount, but the fact is I do not have a house which leads people like me to buy RDP from deserving beneficiaries who are not working but needs money. The solution to address this crisiss if for our government to use this money by building house for people to rent with the intention to buy. By doing so, they would be puting dignity to the people as your record will show that you need this house. But using Credit Act will not solve the problem. In my case, I can afford an RDP in the market as there will be no Credit Screening, as long as the money is availble, the seller will accept it from me and i will have a house for my family.
Distressed
Mzukisi Mali
Hi kecia!my Gross salary is R5000-R5500 and wants to know if I qualify for low cost house.what is it they are looking for in a payslip?is it Gross salary or net?do I qualify?my area has called for people to do survey about those houses and I put my name on the list but wants to know what my chances are pls reply me!
Hi Lydia – sorry for the delay. With your salary, yes, you should qualify for the FLISP subsidy, which will then reduce the loan finance that you would have to secure to afford the house. However, at your salary it will be very tight: on a gross salary of R5500, you would qualify for a subsidy of about R73 500. That’s quite a lot, but if the house costs about R300 000 (its unlikely it would be much less), you would then need to qualify for a loan of about R226 500. If you had no other credit outstanding, and if your credit rating is good (you’re not blacklisted) then you might qualify for a loan of about R160 000. Unless you have additional savings, that’s not enough. I’m sorry. To address people in your situation who won’t qualify for enough mortgage finance to afford a house, the policy offers an alternative approach: that you apply for a serviced stand for free, instead of the subsidy, from the municipality. You need to call your municipality and ask them if they offer this part of the policy.
Is the subsidy accessible and available as we wish to apply and do not know if it is the scheme is already operating or not
H Mary. Yes, the subsidy is operating although probably not as fast as we would all like. The implementing organisation is the National Housing Finance Corporation. You can reach them on 011-644-9800 or http://www.nhfc.co.za They’ve got a brochure that answers frequently asked questions on the FLISP that you can download: http://www.nhfc.co.za/files/FLISP_Brochure.pdf If you contact them, they can tell you where there are housing programmes underway for which the FLISP will apply.
hi
My mothers sister applied for a RDP house in 1996, and she hasnt had a house until today. she is getting old and her greatgranchildren are growing up finishing school. what can she do because she is still waiting? she only earns grant money from gov as a pensioner
Hello Busisiwe – I can only imagine your frustration! Your aunt’s wait has been very long indeed. I’m afraid she’s not alone, however. Very many people have been on the waiting list for over 10 years. I do think you should check that she’s still on the list however. Call or visit your local provincial office or municipality. Bring her ID and whatever proof she has of having joined the waiting list in 1996, and ask them to tell you when her turn will come. I wish you luck.
Hi Kecia, My gross is R6400 and I was applying for a low cost house in the new development in Pelican Park in Cape Town where I was turned down and they were saying I need to earn a gross of R9000 and the cost of the house is R290.000.Is this possible. Now I am planning to apply jointly with my brother. Now I need to know if this will affect him in future if he gets married oneday and may be would want to apply for a normal subsidy in the bank
Hello Brenda. It is complicated, yes. At an income of R6400 per month, you could qualify for a subsidy of about R67 400. This would mean that on a R290 000 purchase price, you would need to access a loan of about R222 600. At your income, however, estimating a 20 year repayment period at 11% interest, and the commitment of 30% of your monthly income to repayment, you would only qualify for a bond of about R186 000 or so – and this is only if you had no other debt. You would need to bring up the balance of just under R40 000 from savings, in order to make it work. If your brother wants to help you, but doesn’t want to jeopardize his chances of accessing the subsidy in future, perhaps he should help you on the savings side so you have enough deposit to reduce the loan amount that you would need to pay for the house. If he jointly owns the house, and jointly accesses the subsidy, I don’t think he’d be eligible to apply again later. That said, we don’t know for how long the subsidy will be available. Your best bet at this stage is to save as much as you can so you can build up a sizeable deposit to make the loan you require more affordable.
Hi Our gross salary is R6000 i would to know if i qualify for the susidy, what are the procedures to follow and when this subsidy will start to be available, from cape town
Hi Sanele. Yes, you should qualify for the subsidy – you can call the NHFC to clarify. Their number is 011-644-9800. At your income, however, you are unlikely to afford enough mortgage finance as you’d require to buy a house with the FLISP subsidy. To address people in your situation who won’t qualify for enough mortgage finance to afford a house, the policy offers an alternative approach: that you apply for a serviced stand for free, instead of the subsidy, from the municipality. You need to call your municipality and ask them if they offer this part of the policy. Cape Town appears to be fairly advanced with this procedure.
Hi kecia,my name is lebo,I just want to know which developers flisp is using in south africa,thanks
Hi Kecia, Where do we go apply? I have never benefited from any government projects and now i need to get my name on the list that gets people RDP houses and also try apply for FLISP since i earn R6000 and i reside in Alexandra, do they have any projects in Alexandra?
Francy, I’m not sure where they’re building in Gauteng, but you can check this with the NHFC – call them on 011-644-9800. At your income, you will no longer qualify for an RDP house, but the FLISP might be accessible.
I earn R5300 a month and my husband has his own small transport business. This brings in R8000 a month. This is more or less what we have to work on.My husband had two bad credits which we paid off one in Nov 2011 and one in April 2012. They are still on the credit profile although they are paid off. Would I still qualify for normal mortgage and first time homeowners assistance and how much would we qualify for.
Hi Shanti. Well done on resolving your credit situation! That’s a very good first step. Yes, a normal mortgage is what you’d still apply for, and the FLISP subsidy. At your income, you should be able to apply for about R56 000, so that would mean you’d need to qualify for a mortgage of about R244 000 (assuming the purchase price of the house is about R300 000). You should go to a bank to see how much of a mortgage you will qualify for, but it will be tight, unless you have savings. So, to generate savings, you should start your nest egg now: put away something each month. This will show the bank that you have a capacity to save and pay, and it will also give you money with which to reduce the loan amount for which you have to apply. For more information on the FLISP subsidy and how it works, and how you apply (there are projects only in some cities) call the NHFC on 011-644-9800
Hi Kecia, I earn R5500 a month and wants to by a house. i see that i qualify for the subsidy, but can i apply for this subsidy if i want to buy a house that is not new?
Hi Vicky. I’m sorry but the subsidy only applies to new housing at this stage. It is possible that over time, the policy will be amended to include resale stock, or second-hand housing, but right now the FLISP can only be used to buy a new house that costs less than R300 000, and which has been built by a developer in a project that is approved by the NHFC. At your income, it is unlikely you’d be able to manage a bond for a R300 000 house, even with the FLISP subsidy. You are in what they call the “gap market”. There is a clause in the FLISP policy, however, that says that those people who earn R3500 – R7000 can apply to receive a serviced stand for free from the municipality. Not many municipalities have started this programme, but its worth checking with yours to see if that’s a possibility. If you can get a serviced stand, then you could use your savings to build your home incrementally, step-by-step, over time. Its not ideal, but you would own the land and you could build what you liked, and this would grow in value over time. Speak to your municipality and see what the options are.
hi Kecia, what assistance is offered to people on state pension. Waiting list for tafta homes in durban are very long andJHB does not seem to have any options.I am trying to assist a 60 year old lady frn accomodation.She has no income other than state pension and the options seem very limited.She is happy as long as she can find something in either JHB or Durban
Hi Melanie. I’m afraid the policy doesn’t distinguish by age so there is no special provision for pensioners. With a state pension as her only source of income, she should qualify for an RDP house but the waiting list is indeed very long. Your best bet is to enquire directly with the municipality. One question to ask them would be this: if she could find a second-hand RDP house for sale, would they give her an individual subsidy to use to purchase it? This has happened before. She would have to find a house that is older than 8 years (RDP houses less than 8 years old cannot be sold), that the owner is willing to sell. The market price for these is often close to the value of the subsidy. Unfortunately there is no list of such houses for sale, however – she’ll have to use word of mouth.
Hi would like to know if do I qualify for the subsidy I am currently earning 6500 but I am employed by a labour broker (QUEST). Do banks give mortgage to temporary employed people and do I qualify for the subsidy?
Phumi, you will have to discuss this with your bank. If you can demonstrate employability and a certain level of longevity in your employment, you may well manage to convince a bank to give you a loan. A mortgage loan is more difficult, however, because it is a 20-year commitment. The bank needs some way to trust that you will be able to pay your monthly commitment for that entire time. One way of addressing it is by building up a savings record, and in fact using savings towards the purchase price of your house so that the amount you need to finance with a mortgage is a smaller percentage of the overall value of the house. You’re right – you only qualify for a subsidy if you can access a mortgage loan to pay the difference of the purchase price. Visit your bank and discuss your situation with them: bring all the documentation you have (your contract with Quest, etc.) to prove regularity of income, and see what they say.
Hi the Kecia… Let’s say I wanna trick the Gov, I get my uncle to buy land and build a new house then sell it to me as a new house. Will the subsidy approve such? I currently earn R8000 and sure won’t find affordable new houses in the Eastern Cape…?
Hello there – yes, that could be a good trick, but I’m afraid the government has already thought of that. In order to qualify for the FLISP subsidy, you need to use it together with mortgage finance to buy a new house costing less than R300 000 in a project that has been approved by the National Housing Finance Corporation. That’s the catch: the house has to be new, and has to be in a project that the NHFC approves. If your uncle wishes to develop a number of houses together in a project, and if he manages to get the NHFC to approve his development (he would have to be registered as a formal developer with the National Home Builders’ Registration Council, and meet various other criteria), then you could apply to buy one of his houses with the subsidy and mortgage finance. But, even if that happens, it will take a very long time! If you want to apply for the subsidy, you’re better off calling the NHFC and asking them to direct you to existing projects.
Hi Kecia. I earn about R5300 mnth. Can I apply for the subsidy as a single mom? I’m really desperate and have 1 child.
Hi Cindy. Yes, you certainly can apply as a single mom – however at your income, it is unlikely that you’ll qualify for enough mortgage finance to cover the purchase price even after the subsidy is deducted. For your income group, the FLISP offers a different option – that you apply for a serviced stand from the municipality, and then build your home incrementally on it, over time. The serviced land you get for free, and then you finance and manage the construction of the house yourself. The problem with this policy is that municipalities are very slow in implementing it – there don’t seem to be administrative arrangements at the local level to accommodate this policy option. I would recommend that you contact your municipality and ask them directly how they are dealing with this. Show them the policy and tell them to look at Section 5 on Page 7. You can download the subsidy policy from this link: http://www.housingfinanceafrica.org/document/finance-linked-individual-subsidy-programme-flisp-policy-as-of-1-april-2012/
Good day Kecia, I have a problem, I had unpaid accounts that I had like 6-7 years ago,I’m starting to pay them off, have already paid one in full, so the problem is I have applied for the flats that are being build in Alex, I earn R4000 and they said i qualify but now I’m worried cause of my credit record. Will it help if I pay them off now, or will my name still remain in the bad credits file, cause they screen us before we can actually apply for the flats.
Hello Phillipine. Well done for having resolved one of your unpaid accounts! You must carry on: its very important that you pay of your bad debts as soon as possible because a bad credit record can limit your access to housing, even if you’re renting. You’re right, your credit record won’t clear immediately, but I think you can apply to the National Credit Regulator to have it cleared, and you can also show your landlord that you’ve been paying it off well. That will count for a lot. You are entitled to one free reading of your credit record per year, I think. If you visit the NCR website, you can find out more, and also the process you need to go through to clear your credit record. Here’s a link: http://www.ncr.org.za/index.php?option=com_content&view=article&id=6 Good luck!
I earn gross income of R8700 would I qualify for vacant serviced stand. and also if you do receive the subsidy (not the vacant serviced stand) is it compulsory to have credit link provider to loan you the balance
Princess, the policy says that the vacant stand is available only for qualifying beneficiaries who earn between R3501 and R7000 per month – but at your income, you would probably struggle to qualify for mortgage finance to buy a R300 000, even with the subsidy. You can only get the finance subsidy if it is tied to a mortgage. You’re in a funny gap that the policy doesn’t seem to recognise. I would call the NHFC anyway and put the question to them: 011-644-9800. The policy has been out for a year now – it is possible that the thresholds will be revised.
I earn gross of R4000 and i’ve applied for the vendalised house is it possible for me the get the subsidy in order to fix the property.
Hi there. I’m afraid you can’t use the FLISP subsidy to purchase an existing property: it needs to be a new house in a development approved by the NHFC. While they may change the policy in the future, its currently limited to new housing.
Hi Kecia, Why Cape Town don’t have any developments less than R300, 000. It look like this FLISP subsidy is those who staying from other provinces only not for Capetonians.
Hi there. I hardly know how to answer your question. If the FLISP subsidy has a restriction that says you can only buy new houses costing less than R300 000, of course there SHOULD be such houses available, else the FLISP is irrelevant. I wish I could tell you more. I am pretty sure that there is a FLISP project in the Western Cape – there is supposed to be one in each province. But as you say, this is hardly scratching the surface. There is demand for far many more houses in this price bracket.
Hi, Kecia let me 1st take a moment to thank you for the good advise that you give , God bless you. i am currently 23 yrs single and the bread winner at home i currently earn R4800 and would like to buy a house my mother is no longer working as she is a pensioner what can i best do
Hello Jeffery, thanks for your post. At R4800 per month, and given that you have dependents, you should be able to apply for the FLISP subsidy. However, your income is not enough to qualify for the mortgage that you’d require in order to afford a house of about R280 000 or R300 000 – even with the subsidy that you could get. For people in your category, the policy offers a serviced stand in stead of the subsidy – that is, the municipality would give you a piece of land, in your name, with services (water and sanitation). You would then have to use your savings or a micro loan to build the house on that land. The process would take you longer – you’d have to build the house at the pace you could afford – but at the end of the day, you’d have a home that you owned. The problem, however, is that not many municipalities have implemented this part of the policy. I would recommend you contact your local municipality – call the housing or human settlements department – and ask them if they have implemented this aspect of the policy and how you would go about applying. Good luck.
Hi Kecia
I am divorced from my husband and could not qualify for a bond on my own at the bank.My brother and i went for a combined bond so that i can also have a place of my own .I live alone with my 3 children and i’ve purchased a resale house for R230.000.My earning is R6500 before deductions.The bank do a debut order of R2520.If i pay my acounts,schoolfees ect theres almost no money left for the whole month for food. As i’ve read all you’re comments my house is less than R300 000 but it is not a newly build house.Does that mean that there is no subsidy for single mothers that has to go that extra mile to purchase a house as the waiting list is so long you will have to wait 20 years before you’ll get a house from council.Why is the government only catering for a certain group of people .If you earn less that R8000 you dont qualify by the bank for a homeloan which means that the goverment cannot help you nor will you be able to purchase a house on you’re own from the bank.
Hi there. Your situation sounds so hard, and yet you’ve already done so well. Congratulations for finding a house for R230 000, and well done to your brother for helping you. I’m afraid that there is no subsidy in the housing sector that is explicitly targeted at single mothers, and the income bracket into which you fall is a very real gap in the policy framework. The policy focus on people earning R3500 and less is legitimate, but there should also be explicit attention to the bracket in which you find yourself. I wish I could say it were different. I think the FLISP focus on new build is for two reasons: first, government wants to directly influence the construction of new houses. There is a housing backlog in South Africa, and they want to see new houses built to combat the backlog. Second, they’re nervous about the potential for fraud if you could use the FLISP subsidy to buy a house on the resale market. While I understand these reasons, I don’t really feel they are valid. Of course we need more houses, but the seller from whom you bought your house then had money to spend, and may have bought a new house, which ultimately adds to the total supply. And fraud is a problem everywhere – its just a matter of designing the right systems to minimise the risk. What can I say to you? I wish you good luck in managing your budget and hope your income can improve. By telling me of your situation, I can show this to the policy makers, and maybe it will make a difference to their thinking. Good luck.
Hi my name is pertunia i earn 2300 a month,my brother earns 2500 a month,n my mom gets 1200 for disability n 840 for my younger siblings,so we are 6 children 2 my mom,i wnt 2 knw what subsidy do we qualify for.
Hi Pertunia. Your total household income is about R6840 per month. I think that would qualify you for a FLISP subsidy – although at your income and with your expenses it is unlikely you’d qualify for enough mortgage finance to take advantage of the subsidy. You fit into the category that the policy says is eligible for a serviced stand (that’s a plot of land with services, but no house – that you have to build yourself) – however this is not yet being offered by many municipalities. I would call the NHFC and ask them what they think you should do. Their number is 011-644-9800. The other option is to call your local municipality and ask them – perhaps they have developed a programme for people in your income category. I know that the City of Cape Town is working in that direction. Good luck
Me and my husbands combined income is R 5700 , we want to know will we be able to qualify for flisp , we have got a pro perty we want to buy it cost R 50000 ,
Hi, I would just like to know if this has to be a RDP house that needs to be purchased in order to qualify for the subsidy. . . or can it be just a normal old home that was built 20-30yrs ago. Thanks in advance.
Hi Lee-Ann. This is the most common question on this website. No, you cannot use the FLISP subsidy to buy a home that was built before. I know it seems crazy that the FLISP subsidy can only be used for a newly built property: homes available on the resale market are often cheaper. The reason for this limitation is that the government is worried about fraud – it would be easier for fraud to happen if the government didn’t have control over who actually built the property. The other reason is that the government wants its money to directly impact on new housing delivery. Personally, I don’t think these are good enough reasons, but that’s the way it is for now. Hopefully things will change as the implementation of the FLISP becomes more familiar.
hi there what are the chances i get a government housing subsidy my partner and i combine salary is R10699.00 we getting married later in the year and have 2 kids i put in a offer to purchase for a house of R310k im a first time home buyer i would like to know ,im just a bit confused, i live in the western cape southern suburbs area?
Hi Ricardo. With your combined income, you should be eligible to apply for the FLISP subsidy. However, in order to be approved, you would have to have never owned a property before, would have to qualify for mortgage finance to pay for the difference between the purchase price and the subsidy, and would have to buy a house that costs less than R300 000. Unfortunately, as I understand the policy, the R310 000 house wouldn’t qualify. You seem to have some time to look further, though. Call the NHFC or write to them and ask them about what the approved projects in the Western Cape are- and also confirm whether I’m right about that R310k house. Their number is 011-644-9800 or you can email them on FLISP@nhfc.co.za.
Dear Kecia, this was the latest on the FLISP from the President’s State of the Nation address on 14 February:
• From April 2012 to December 2012, Provincial Departments committed a budget of 126 million rand for the FLISP
• The money is being used through the National Housing Finance Corporation, which has been appointed to deliver houses to people within the Gap market in twelve registered projects
• A total of 70 million rand of this amount has been used to date
• Projects include Walmer Link in the Eastern Cape, Lady Selbourne, Nelmapius, Bohlabela Borwa, Cosmo City and Fleurhof in Gauteng, Intabazwe Corridor Housing in the Free State and Seraleng in North West.
Thanks Michael – this is very helpful. Interesting to think about how far R70 million would go – while it sounds like a lot, if you assume that the average subsidy might be R40 000 (noting that higher income earners get less and lower income earners get more), this translates into about 1750 subsidies. That’s less than the number of people that have read this blog. I’m hoping that with time the pace of implementation will pick up and more people can be served.
Hi Kecia,thanks for shedding light on this subsidy topic. My question is,is the subsidy only available to first time home buyers or could someone who owned property previously also apply?I have owned property before but because of my divorce we had to sell the property as per court order and now i`m in the boat the estimated 20% worforce of SA find thenselves in of qualifying for a bond.
Best regards
John
Hi John. The subsidy is only available to first time homebuyers – I can see that your situation is somewhat unique, but even in this case, I believe that because you owned the previous property, you are not eligible now. You might want to email the NHFC to be sure however: flisp@nhfc.co.za You’ll probably find that you have to downsize to a smaller property and use the equity that you gained from the sale of your house – that which you were able to keep as part of the divorce agreement – as your deposit. In the meantime, save as much as you can – this is especially important for banks when approving individuals for bonds who are at the edge of their affordability. They want to see that you can save, and then you can use this for your deposit to reduce the size of mortgage for which you apply.
Hi I need to know do I qualify for rental if Im blacklisted and where to apply for it in KZN Durban?
Bonge, I suppose it depends on the landlord – some landlords do undertake credit checks and will refuse to rent you property if you’re blacklisted, but I’m not sure if all have that criteria. What is important is that you pull together the necessary documentation that shows that you’re recovering from your credit crisis, that you’re repaying your debt, that you have disposable income, and that you can afford the rent. I think the best organisation to contact in this regard is the Tenant Profile Network: http://www.tpn.co.za As for rental housing in Durban, I’m afraid I don’t have that information. Perhaps you could call your municipality and ask them?
Dear Kecia,
i just called NHFC now and spoke to a lady by the name of Dikeledi, she said to me I must get the house first and then get it approved by the bank then I can get back to the to apply, but she said it must be any house not necessarilly a new house.
is this info correct?
Londiwe, thank you so much for this post – I got so excited that I called the NHFC and got this information: YES, it is true that in GAUTENG you can use the FLISP subsidy to buy a house on the resale market. This individual programme is not yet available in other provinces, but in Gauteng its been agreed to go ahead. If you live in Gauteng, the way you go about the system is as follows: 1. Find the house you want to buy, and make sure it costs less than R300 000. 2. Apply to the bank for a mortgage for that house – and ask them how much they’ll approve you for. You can tell them that you’re also applying for the FLISP subsidy. 3. Once you get the approval from the bank, take that to the NHFC (they have four centres in Gauteng – in Ekurhuleni, West Rand, Central Gauteng and Tshwane). The NHFC is committed to respond to your application within 7 days – they basically check that you’ve never had a housing subsidy before, that you’ve never owned property before, and that you satisfy the other criteria for the FLISP. 4. When they approve you, I presume you go back to the bank to show them this contribution towards your deposit for the house – they then revise the bond that you’ll get, and all of these documents are then submitted to the transferring attorney who processes the sale. If you have an estate agent, they can help you with this process. 5. Lastly, when the sale goes through the NHFC pays the money to the transferring attorney. I’m going to write a more detailed blog about this as soon as I get more information from the NHFC. Thanks so much for alerting me to this shift in the policy! Its a very exciting development and I’m sure many people will be excited to hear.
Hi Londiwe – thanks again for notifying me of the developments with the FLISP subsidy. You are right, the subsidy can now be used for the resale market, and to buy vacant stands in a number of provinces. Take a look at the blog I’ve just written on this: http://www.housingfinanceafrica.org/blog/flisp-housing-subsidy-extends-to-resale-market/ I hope you manage to address your housing needs with this new development in the policy.
Hi, me and my husband dont qualify for the FLISP subsidy, since we earn more than R15000 p/m, however we still cannot afford most of the houses in the area. We live in Durban and decent houses costs R500000 or more. We are what you call the middle incomers, and its very sad that the government has done so little for us, yet we are the majority of the tax payers. There are developments like Cornubia in Durban but there is no information of how one applies for these houses. I will the government would look into this, its nice to take care of the people on the ground who earn little, but they are not the only South Africans, we feel robbbed.
Dear Slindile – thanks for this post. I think its a very important issue. Housing affordability is a problem for very many people, and not just the most poor. The difficulty is that there are just so many people who earn less than R15 000 household income per month (about 85% of the population) that government really cannot afford to support more widely than it already does. Your income places you among the top 15% of households in South Africa. In terms of our tax policy, houses that cost less than R600 000 (I’m pretty sure this is the amount) are exempt from transfer tax – but that’s the only benefit that might apply to you. I think you should be able to find some houses below R500 000 in your area, however. Take a look not just at new housing, but also at the resale market. Sometimes, you can find a house that hasn’t been renovated for a very good price. Also, use the time while you search to save up so that you have a good deposit with which to buy the house that you finally find. This will decrease your mortgage payments and will make the move more affordable. Good luck.
Hi Kecia
Whats your take on the propposed tax incetive to encourage developers to build more housing unit priced below R300 000. Do you think this will inticing enough for developers to venture into the ‘gap’ market? Also from research the ‘gap’ market is identified as housing stock priced between R250 000 to R300 000 do you think this is a realistic measure? Finally what other complementary measures do you think are necessary that government can implement to complement the tax incentive. Just from reading from your blog it is clear that there is a huge demand for housing which is not met in terms of supply.
I look forward to your response.
Hi Penelope – thanks for raising this very good question. The tax incentive was announced last year and nothing has happened yet. I do believe that developers face unique challenges in building in the gap market – from the limited affordability of their clients through to the high cost of bulk infrastructure connections and processing delays at the municipal level. If the tax incentive can make delivery in this market a more commercially realistic proposition, that would be great. We certainly need more supply in this market. That said, I also feel the tax incentive should not just make it financially more attractive, but should also be structured in such a way that the current logjams (such as those at municipal level) get addressed. In the long run, the level of demand in this market should be enough to entice developers to operate in this space.
You ask what the definition of the ‘gap’ market is. Households who earn more than R3500 per month cannot access the RDP housing subsidy, so their affordability should begin to define the gap: this is somewhere in the region of R150 000! At the moment there is nothing being delivered in this price bracket (other than the RDP house itself). The cheapest newly built house in SA is about R270 000, but supply is limited (and yet this is one of the fastest growing markets). And the ‘normal’ market kicks in at about R500 000 per unit. The FLISP subsidy policy says that it is only for houses costing less than R300 000. So what is the gap? We need houses that cost as little as R150 000 through to R500 000. The bulk of this affordability is at the bottom end of that range and in order to get a subsidy, they must cost less than R300 000. This is why the tax incentive is supposed to also target this market.
Is this realistic? From a supply side, I see that there are constraints and while on the one hand its about building cheaper houses, on the other it is about making the housing delivery process cheaper itself – and this is something that falls substantially on local government’s shoulders. From a demand side, however, its entirely realistic: 60% of SA’s population has an income that would make them eligible for the RDP housing subsidy – although some of these already are suitably housed, those that aren’t comprise a waiting list that is more than ten years long. Only about 15% of SA’s population earns an income sufficient to afford the cheapest newly built house. This leaves about 25% of our population in the gap in the middle. They are working individuals, too rich to get the RDP subsidy and too poor to afford what is currently available on the market – this gap has to be filled.
Good evening
I would like to know if I will qualify for pelican park gap housing if my gross salary is R6500 per month and I get extra income from selling avon products and toilet paper.
Thank you
Bernie
Hi Bernie. I see the New Horizons Gap houses at Pelican Park are advertised at R290 000, with a R2000 deposit required. You need to check with the NHFC if they have included this project in the FLISP subsidy scheme. If they have, you may well be able to afford the mortgage required to buy this house – but that depends on your other expenses and whether or not you have any other debt. Call the NHFC on 011-644-9800 or email flisp@nhfc.co.za. Unfortunately, the other income you get from selling things will probably not count towards your affordability calculation because it is informal – but check this with the bank just to be sure. What you should do in the meantime is save as much as you can on a monthly basis – this is for two reasons. First, if you save monthly, you demonstrate financial discipline – this is important for the bank when they are deciding whether or not to give you a loan. Second, the amount you save can be used towards the cost of the house, which will reduce the amount you have to borrow. Call the NHFC first to see if Pelican Park houses qualify for the FLISP, and then take it from there.
I am earning 7500 and my wife 5800, is it possible to combine salaries if i have more debts but managing to pay them? what should i do when i have been called to complete the process of application?
Hello Solly. With a combined income of R13 300, you should qualify for the FLISP subsidy – and yes, you must combine salaries because FLISP eligibility is evaluated on household income, not individual income. The amount of mortgage finance for which you qualify will be the deciding factor on whether you can afford to buy a house – and that depends on the extent of your debt. You need to visit your bank and discuss all of this with them – find out how much you’d qualify for, the two of you together, and then see if this is enough to be able to meet the purchase price of the house together with your subsidy and any savings you might have. Have you called the NHFC yet? They should explain the whole process to you. 011-644-9800
Hi Kecia
I’m single live in JHB,earning 5500. p/m .
I’m very interested to buy a house.
I would really like to now how much subsidy would I qualify for if I get a re-sale house of R300 000
Thank you!
Hi Vusi – the fact that Gauteng allows you to buy a resale house with the FLISP subsidy is very good for you – at your income, it is unlikely you’d afford enough mortgage finance, even with your FLISP subsidy, to buy a R300 000. But the resale market has cheaper houses, so you may just be able to make it work for you – that is, if you don’t have any other debt. Assuming you have no other debt, this would be your situation: with an income of R5500 per month (household income, and also assuming you satisfy all the other FLISP criteria), you should be able to access a subsidy of about R73 500. Meanwhile, if you qualify for a mortgage, at an interest rate of say 11% over 20 years, you could possibly qualify for about R159 000. Add this to your subsidy and you have a potential housing affordability of about R232 500, and a responsibility to pay R1650 per month for 20 years (which means you need to be in stable employment). If you feel you can handle this, you should then consider looking for a house for less than this amount, and also start to save, to pay for all the moving and other costs associated with buying a house.
Our Government is doing a great job with this FLISP subsidy, but as a hard working citizen of this country I also feel our tax money must be put to good use. The Government must be financing 50% if the mortgage required to buy lets say a R300 000 house.
Hi there. I’m not sure I understand your comment. The FLISP subsidy amounts range from R87 000 for a household that earns R3501, to R10 050 for a household that earns R14 901. However, households can only access the subsidy if they also qualify and access mortgage finance for the difference. The government put the R300 000 restriction on the purchase price to make sure that the subsidy was only used for entry-level properties; and only first time home buyers qualify. Does this answer your question?
Good day, I work for government and earn 10000 gross my husband works in a facroty and earns 8000 gross he has a good credit record whilst I dont, we married in community of propery what are the chances of getting a flisp susbidy? can my husband apply on his name only? on two occation we have applied for joint bond and we were turned dow due to low scoring. Thanking you in advance.
Hi Mandy. I’m afraid with a R18 000 household income, you can’t apply for a FLISP subsidy – the income threshold is R15 000. You can’t apply as an individual either, because one of the requirements for the subsidy is that the income is calculated across all household members. To improve your credit scoring, you need to pay off all of your debt and begin to save, a regular amount every month. This will demonstrate to the bank that you have the financial discipline necessary to take on a 20-year responsibility to pay off a bond, and your credit score will improve. Good luck
I would like to know if I will qualify for this FLIP susbidy because I am blacklisted and married in community of property, and also is it possible for my husband to apply for it in his name?
Hi Thandie – you pose a good question. In order to qualify for the FLISP you need to also qualify for mortgage finance – the two go together. If you’re blacklisted, you won’t be able to access the mortgage finance and so you won’t be able to get the FLISP either. But if your husband isn’t blacklisted, its possible, perhaps, that the mortgage is tied just to him. That would limit the amount of mortgage finance you could get – affordability would just be calculated on his income. I would double check with the NHFC – ask them if your husband can apply for the FLISP and the mortgage,given that you’re blacklisted. I’ll see if I can get an answer from them soon too.
I am earning 7200 and my husband earning 6500 monthly.
Hi there. With a R13 700 household income you should be able to qualify for the FLISP. However, you can only access the FLISP if you also qualify for mortgage finance. Then, you use both the subsidy and the finance to buy a house that costs less than R300 000.
Do goverment employees qualify for this if they earn R3500 to R15000.Also,do people who are not first time home owners qualify?
Hi Yonelisa – yes, government employees do qualify if they earn within the income range. However, you must never have owned a house before.
Helo Kecia my husband earns R8000 do we qualify? If we do which number can we call for assistance around Pretoria help please!
Hi there – if the total income of your household is less than R15 000 per month, then you should qualify – as long as you also qualify for mortgage finance, and you have never owned a house before. There’s a new aspect to the policy that applies in Gauteng – you can use the FLISP to buy an existing, resale market house. This is great news because resale houses are often cheaper. Find out from your bank how much mortgage you qualify for, and then add this to the amount of FLISP subsidy you think you could get (at R8000 household income, you could qualify for about R57 000) and that will give you a rough estimate of the purchase price you need to look for. Once you find some place, you can call the NHFC for more information about next steps. They do have an office in the Pretoria area, I think – call their Joburg office and they’ll help you: 011-644-9800
Good day im about to buy a house of 450 000 my basic salary is 6300 im working on a commission structure which come up to 7 to 8000 do I qualify for a subsidy
Hello Nandy. I’m afraid you can’t use the FLISP subsidy to buy a house that costs more than R300 000. At a basic salary of R6300, however, its unlikely you’d qualify for a mortgage of more than R180 000 – R200 000. Go to your bank and find out how much mortgage you qualify for, given your income. Add to this whatever savings you might have. Then, if you find a house that is less than R300 000, you should be able to get a FLISP subsidy of about R56000 – R66 000, depending on your actual income. So, adding the mortgage + subsidy would give you about R256 000. That’s the price range you should be looking at.
Hi I would like to apply for a housing susbidy, however i am 26 years old and i earn R3500 a month and i do not have any children, i am not married do i qualify for this susbidy?
Hi Rhulani. I”m afraid you have to have dependents in order to qualify for the FLISP subsidy. Its likely, however, that even if you did have dependents, at R3500 you wouldn’t qualify for enough mortgage finance to afford a house even with the FLISP subsidy – unless you live in Gauteng, where resale market houses are included in the programme. Start saving for your housing now so that when you do have dependents, when the time in your life is right, you’ll be ready to make the investment.
Hi Kecia. How possible is it that the FLISP prorgam can be utilised to house those people who want to live in newly established housing co-operatives. Won’t the element of co-operation empower them to use collective salaries to build and own their houses with the subsidy of FLISP given the housing market that is out of the required range?
Hi Tumelo – I’m actually not sure if the FLISP can apply to people living in housing co-operatives. I’ll check for you, but I believe it is restricted to full and sectional title. However, the social housing subsidy may well apply to you. Take a look at the information on the Social Housing Regulatory Authority’s (SHRA) website: http://www.shra.org.za.
Hello
I’m a Single Mothe with Good credit Record and Earning R9000, i need a house for my 4yearl boy as we are struggling with renting places, i need a stable home.
Will a qaulify for this?
And when is this Project come to gauteng and Where can one Enquire for Application as well
Hi there. You’re in an excellent position with an income of R9000 and a good credit record. As a single mother with that income, you should be able to apply for a FLISP subsidy of about R49 000. And, with a good credit record, it is possible that you could qualify for a mortgage of about R260 000. The maximum value of a house that you can buy with the FLISP, however, is R300 000. So, this is what you must do. 1. Find a house you want to buy – you can either buy a new house in an approved project, or in Gauteng, you can also use the FLISP to buy an existing house on the resale market. 2. Once you’ve found the house, and you’re sure its the right one for you, put in an offer to purchase, conditional on you securing finance and getting a subsidy. This just shows the seller your interest. 3. Then, you need to go to the bank and apply for a mortgage for that house. Tell them that you intend to also apply for the FLISP, and that you need an approval from them to take to the NHFC (National Housing Finance Corporation – the administrators of the subsidy programme). 4. Once you have this from the bank, take all these documents to the NHFC. They’ve got a number of offices in Gauteng, so call them on 011-644-9800 to see which office is closest to you. Also check this site again – in the next couple days I’ll be posting a new blog on how the subsidy system works, and some new documents from the NHFC. Good luck!
Dear All,
kindly assist me is it possible to apply for this Govermenet Subsidy when you already have a house that was bought last year with Cosmopolitane?
the house worth R286000?ihave already paid bond for 5or 6 instalment
Hello Zanele. Congratulations on having bought a house already – there are not so many available, so you are lucky to have bought one. I’m afraid the subsidy is only available to people who have never owned a house before, however, and you cannot apply retrospectively. I wish you much happiness in your home.
I earn R11500, how much would i qualify for? and can i apply for this subsidy as rather a Building Loan and purchase vacant land at a safe and secure environment for my children… I have seen a plot on the market for 160K and use the remaining amount to build the house on that plot.
Hi Sbu – At your income, and if you qualify, the amount would be about R33 000. YES, you can use the subsidy together with a mortgage to buy a vacant stand on which you plan to build a house – this is a new development, and I’m so excited about it. It means that there are now many more options available to people! Take a look at the blog I’ve just written on how the subsidy works. At the bottom of the blog, there are links to the NFHC’s documents, providing information on how much you qualify for, where to apply, and what the conditions are.
The house is worth 472 000 and my net income is R20 000 and my wife is unimployed do I qualify for a the subcidy?
Hi Greg. Unfortunately the subsidy is only available to households with an income of less than R15 000, and to buy houses costing less than R300 000.
Kercia, is this housing programme in full swing, if yes where can I get to know more about it?
Hi Thabiso. Yes, the programme is in full swing – though its taken some time to get there! Take a look at the blog I’ve just written on how the subsidy works. At the bottom of the blog, there are links to the NFHC’s documents, providing information on how much you qualify for, where to apply, and what the conditions are.
Hi there,I don’t know when was most stuff posted here but I think they have changed the policy to buy existing house,get a site and build on it.But the info you gave was very helpful.thank you
Hi Wandi – you’re absolutely right – the policy has changed. I’m very excited about the new developments because I think they’ll really improve the opportunities available for accessing and using the subsidy. Take a look at the blog I’ve just written on how the subsidy works. At the bottom of the blog, there are links to the NFHC’s documents, providing all sorts of information.
Hi,I would like to apply for a housing susbidy,am earning 5500 pm and my husband 7500 can we qualify?
Hi there. At a household income of about R13 000, you could apply for a FLISP of about R22 875. You’d then have to access a mortgage and use the mortgage and the subsidy together to buy a house. The good news is that you can now use the FLISP subsidy to buy a house on the resale market. These are often cheaper than new houses. Take a look at the blog I’ve just written on how the subsidy works. At the bottom of the blog, there are links to the NFHC’s documents, providing more information.
Hello
my name is Iris i just heard about the housing subsidy, i earn R3700pm and I would love to apply for the subsidy, my question is would it be possible if me and my mother do a joined bond? because she earns R4000pm, and how do i go about applying for the subsidy. Iv always dreamt of buying my family a house could you kindly assist me on that
Kind Regards
Iris
Hi Iris. You can certainly apply for a bond using the joint income of you and your mother. At a household income of R7700 per month, you’d be able to apply for a FLISP subsidy of about R58 650, and then you could apply for a bond to cover the difference of the purchase price of the house. One thing to remember though – the bank will only give you a bond for the years remaining before your mother retires. So, if she’s 50 years old (for arguments’ sake) you would probably only be able to get a 15 year bond. Check with your bank and see what they say. From their side, they’ll want to make sure that your joint income will be available for the full period of the loan. Take a look at the blog I’ve just written on how the subsidy works. At the bottom of the blog, there are links to the NFHC’s documents, providing more information on how much you qualify for, where to apply, and what the conditions are.
Hi Kecia,
If I earn about R9500 per month, approximately howmuch will i be qualifying for FLISP?on the blog it states that if I buy a stand I must build a house not more than R300 000,who will evaluate the house?
You’d be able to apply for about R46 500 in subsidy, and might be able to qualify for about R230 000 in mortgage finance – that is, if you don’t have any other debt. On the evaluation of the house – that’s a good question! I suspect the NHFC will work with the National Home Builders’ Registration Council to do the evaluation. If you are building the house yourself, it must be done by an NHBRC-approved builder.
hi, i am Thulisile single mother of two kids . i eran R8000 per month . i alredy applied for a house at cosmopolitan worth 350000. absa approves me by R300 000 so i have to pay the difference as deposit of R50 000. i really dont know what to do . can i cancelled everything and wait for flisp. Cosmopolitan they are promising to build the house this septermber 2013. I like to apply at x22 Nellmapius. Please help should i cancell or what to do . when flisp are they going to start building the houses . Cell 0822965421. Thanks
Hello Thulisile. At your income, you should certainly qualify for a FLISP subsidy – however, you cannot use this if the house you want to buy costs more than R300 000. According to the income tables, you should be able to receive about R56 000, which you would then match with mortgage finance to buy a house that costs less than R300 000. This means that your mortgage will be less than the R300 000 that ABSA says you qualify for – which means that your monthly payments will also be less. However, it does mean you’ll have to start the process over again, and it may take a while – the queue for the FLISP is long and they only approve so many subsidies per year. You should do two things now. First, find out if you can withdraw your offer to purchase – it depends on what it said and whether you’ve already signed the agreement of sale. Then, call NHFC and find out from them what the queue looks like and if you could access the subsidy soon.