Housing the Nation
Category News
AN innovative joint venture between an estate agency, construction group and investment company would see pump R5 billion annually into affordable housing projects nationally in a bid to broaden home ownership and wealth development.
Acutts Motlekar, a joint venture between the Acutts Property Group and African investment holding company Motlekar Holdings, in conjunction with construction company Group Five as the building contractor and development manager, aimed to bring 18000 housing units to the market each year.
This conservatively translated into a R5 billion injection to the local economy with spin-offs and job creation expected in land surveying, architecture, building and construction, material delivery and administration. Currently the initiative has the capacity to deliver 100 houses a day, a mobilisation that will also promote employment in the selling, mortgage origination and property transfer value chain.
The properties would be geared towards first-time buyers and middle-income earners, typically households earning R13500 to R25500 monthly to secure bonds between R450000 and R850000. The new suburbs would correspond with the government's proposed economic zone requirements for newly-establishing commercial centres.
"In areas where the government is driving economic development, there is a critical need for housing as investments come to bear. The government is driving a need to create housing, specifically in the spectrum of the economically-active population that can purchase affordable housing - and this initiative answers that demand," Acutt’s chairman Pat Acutt said.
Old Mutual research into South Africa's affordable housing reflected the country has 14-million households of which half were sub-standard quality and included 3-million formal dwellings without sanitation.
Government housing focussed on households earning below R3500 a month, while private sector development catered to the country's top 10% earners receiving more than R20000 a month.
The research, covered in its A Glimpse into the Development Impact Funds report by Christine Glover and Leon Dykman and released in March 2012, concluded that a quarter of South African households had limited opportunities to participate in the formal housing market. A 2006 survey reflected the country had a housing backlog of 660000 units in the middle and upper income tiers covered by the Financial Services Charter (households between R2500 and R7500), while Statistics SA showed a decrease in private sector housing delivery in line with a market contraction and reduced bank lending.
Acutt said the association between Acutts and Motlekar would drive and transform the South African affordable housing property sector. The realty company Acutts Motlekar was forged to market newly constructed houses and apartments across South Africa on behalf of the property developers.
Author: Jonathan Acutt