Business/ Finance

Get your Government housing subsidy now

Cape Town is in the midst of a housing crisis, exacerbated by the huge numbers of people left homeless by shack fires. The Western Cape Government and the City of Cape Town are facing the mammoth task of providing housing to thousands people. Work has already started on the N2 Gateway housing project, which will provide low cost housing to thousands on the Cape Flats.

But when these homes are eventually completed, will those for whom it is intended be able to afford it? The following are some guidelines for applying for a housing subsidy from the Western Cape Government.

Individual Housing Subsidies

There are two forms of individual subsidies:

  • Non-credit linked subsidies - enables you to buy your property using the subsidy and maybe your savings. You will not have a loan to repay.
  • Credit linked subsidies - mean that you get the subsidy together with a loan from a financial institution. You will have to repay the loan.

What can you use a housing subsidy for?

You can use the housing subsidy to buy a house and land.

In order to qualify for a housing subsidy, you:

  • Must be married, live with your partner or have financial dependents.
  • Must be a lawful resident of South Africa - you must be a citizen or have a permanent resident permit.
  • Must be able to enter a legal contract - you must be over 21 or must be married or divorced and of sound mind.
  • Need to have a gross monthly household income of less than R3500.00.
  • Must not already have benefited from other government housing funding.
  • Must be a first-time property owner.

How to Apply for a Non Credit Linked Housing Subsidy

You need to fill out an application form, which is available from the Western Cape Housing Development Board (WCHDB). If you are awarded a non credit linked subsidy, you can use the subsidy to buy a property. The subsidy can be topped up with your savings.

When you complete the application form, you also need to supply the documents listed on the form.

In addition also supply:

  • A certified copy of the sale agreement and/or building contract, as well as approved building plans.
  • A conveyancer appointment: The developer or seller must nominate an attorney or conveyancer. The conveyancer will register the transfer of the property and will help the WCHDB to administer payment of the subsidy amount to the developer or seller.
  • A certificate from the conveyancer. This certificate confirms that the conveyencer is prepared to register the property and administer payment of the subsidy. If a conveyancer fee has been agreed upon this must also be listed. The Conveyancer's fee is paid out of the subsidy.

How to Apply for a Credit Linked Subsidy.

Application forms for a credit linked subsidy are available from accredited lenders. You apply for a subsidy at the same time as applying for the bank loan. Both the subsidy and the loan will go towards buying the property.

Credit linked subsidies are administered by banks and financial institutions. These approved bodies act as agents for the WCHDB. You can get a list of lenders from the nearest WCHDB office.

How much is the subsidy worth?

The amount of the subsidy that you can get and the contribution that you have to make depend on:

  • Gross household monthly income
  • Whether you are aged or disabled
  • Whether you are participating in the People's Housing Process

If the gross household income is under R1 500 per month, the subsidy is R25 800; if it is between R1 501 to R2 500 per month, the subsidy is R15 700; if the household income is between R2 501 to R3 500 per month, the subsidy is R8 600; the elderly and disabled beneficiaries get up to R28 279.

Beneficiary contributions

If you receive a housing subsidy you are required to make a contribution towards the cost of the house. Qualifying subsidy beneficiaries falling within the income category of under R1 500 per month will be required to make a financial contribution of R2 479. Beneficiaries falling within the categories receiving less than R25 800 will have to make up the shortfall of money adding up to R25 800. Beneficiaries who are in receipt of Old Age pensions, those whose combined income is below R800.00 per month and those who participate in People's Housing Process initiatives are exempted from making the contribution.

Detailed information on the requirements and process relating to Individual Housing Subsidies are available in the Housing Code. For more information contact the Subsidies Helpdesk on tel. 021 483 2342, Desiree Jacobs on tel. 021 483 3977, email dajacob@pgwc.gov.za; Glyn Grey on tel. 021 483 4641, email ggrey@pgwc.gov.za; Natasha Oosterwyk on tel.021 483 4037, email noosterw@pgwc.gov.za

This information has been supplied courtesy of Housing Management, Provincial Government of the Western Cape - Department of Housing.

 

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