Chairperson’s Welcome
Vuyiswa Ramokgopa
Dear Members, Stakeholders, Practitioners, and Industry Affiliates,
The real estate industry, and home owners, have been given a small reprieve with the Reserve Bank’s recent decision not to raise the repo rate, leaving it unchanged at 8.25%, and the prime lending rate remaining stable at 11.75%.
In fact, the market was already benefiting from the July decision to cease the hiking cycle, with Rhys Dyer, ooba Home Loans CEO, saying that application volumes recorded in August 2023 grew by almost 8% on the average monthly intake of applications processed by ooba Home Loans in Quarter 2 ‘23.
The September decision to maintain the repo rate will likely further boost these application volumes.
That’s the good news. The bad news is highlighted by the recent devastating explosion in the CBD, as well and unrelated building fire in Johannesburg in which 70 people lost their lives.
Alastair Anderson from Property Flash so rightly said, “It’s shocking for the government to blame the tragedy on Apartheid (as Lindiwe Zulu, minister of Social Development did) or on foreigners trying to find homes and ending up paying rent to slumlords in overpopulated buildings. The spatial planning problems hangover of Apartheid are well-documented.
But the truth is that too many buildings have been poorly managed and left to become derelict. Further, many buildings have been built without the correct safety, fire, and other certificates in place. Others have been converted into residential buildings in haphazard ways where safety standards are ignored. Basic services are often not provided to residents”.
Research conducted by the Centre for Affordable Housing Finance in Africa reveals that an estimated 20% of urban households in South Africa are situated in informal settlements.
This data underscores a housing deficit of about 3,7 million, with an annual increase of 178 000 units. The study also points to South Africa’s high unemployment rate of 34,4% and the surge in urban migration as factors aggravating the housing dilemma. On a national scale, the findings indicate that12% of households don’t have access to tap water, 18% are without adequate sanitation facilities, and15% are not legally connected to the primary electricity grid.
This issue is explored further in the ‘Solutions from the Edge’ article on page 5.
These are not new issues; in fact, they’ve been with us for decades, and the cost of bad municipal planning and maintenance, coupled with an ineffective affordable housing policy, is increasingly putting households at risk.
Solutions currently elude us, but what is clear is that any successful fix will necessitate public &private partnerships and co-operation.
