SA Affordable Housing March - April 2019 // Issue: 75 | Page 32

CONTRIBUTORS
Creative solutions
are necessary
When it comes to providing enough
sustainable, affordable housing to
meet demand, the largest hindrance
that dominates in government and
financial institutions is the definition
of what a home is and who can be
financed to receive one?
By Iqbal Hirji, founder of RWPA Solutions
M
odular style homes that are built in factories,
transported on flatbed trucks and erected on site in
days are increasingly seen as a cheaper solution in
answering the global, massive housing backlog.
Constructed from predefined quantities in factories,
these homes are also more sustainable in that they waste
fewer materials and reduce construction efforts and time on
site. An additional benefit with modular homes is the
demand for housing in, for example, Gauteng can be used
to create jobs at factories in more rural areas like Limpopo.
Despite this, municipalities in South Africa do not appear
to encourage non-traditional building methods and
town-planning divisions are much more likely to fail plans
for projects that propose alternative building methods or
environmentally sustainable designs. In fact, in some cases,
South African building law is outright aggressive towards
any innovation in the housing industry that moves homes
away from old brick and mortar methods. For example, in
many suburbs around the country homes built from wood
(as they are in the US) are strictly forbidden, a hangover
from the old apartheid government that did not want rural
style homesteads in the city.
With house prices often making them entirely unattain-
able for many residents the need for creative, cost-effective
solutions for housing is undeniable, but even in the unlikely
event that sustainable designs are passed by the municipal-
ity, they run into more hurdles when it comes time for
potential buyers to apply for financing.
Purchasing a modular home is an almost impossible task
under the current climate due to a reticence from banks to
give financing to buyers. The fear from banks is that these
homes depreciate rather than appreciate in value and as
such are not attractive for repossession from defaulters.
This is out-dated thinking – a home built properly from
panels and frames is no different to a home made from
30
MARCH - APRIL 2019
bricks and mortar. Both require maintenance over time of
roughly 5% of the value of the property a year to maintain
their ‘like new’ status and, if properly looked after, both
should appreciate in value simply due to the fact that the
price for building new homes will always increase – irre-
spective of what they are made of. Regardless of actual
maintenance status, the property the home is built on
always appreciates.
If banks remain unconvinced then an argument can also
be made that finance houses are quite capable of develop-
ing a new type of finance model on which the homes are
calculated similar to financing a vehicle, and the land on
which the house sits is financed like a traditional property.
This combined solution would allay the fears of the
financial institution, while still allowing a whole sector of
the population, who are currently forced to live in informal
housing, to get a foot onto the property ladder.
The need for creative, cost-
effective solutions for housing
in South Africa is undeniable.
The barriers to getting people into Agrément certified, safe,
waterproof, wind-proof and fire-resistant homes are all in
the heads of those who make policy or provide the financ-
ing. Changing this requires strong political leadership from
all spheres of government acting collaboratively to coordi-
nate policy and resources, alongside innovative thinkers,
civil society, NGOs and disruptors in the corporate and
financial sectors.
Working together we can get more people into safe
homes and eradicate the blight of shacks in our country.
www.saaffordablehousing.co.za