Giving tenants foot on property ladder
THE City of Cape Town’s Human Settlements Department is offering about 9 000 qualifying tenants who are living in council-owned rental properties the opportunity to purchase their units to become property owners.
These properties include freestanding and semi-detached houses, terraced or row houses and maisonettes located in areas such as Gugulethu, Valhalla Park, Mitchells Plain, Heideveld and Nyanga.
The Development Action Group (DAG) acknowledges this initiative as a noble idea that offers many households a footstep on the property ladder.
However, the success of such an initiative is largely dependent on the design and implementation thereof. There are several questions and/or challenges to consider:
The city is constitutionally obligated to provide access to adequate housing for its residents, and it is important for the relevant authorities to shed light on why it has decided to sell rather than give the houses to the tenants or retain them as crucial affordable rental units.
The notion that housing can be utilised as an asset lifting people out of poverty has proven to be not always the case.
A significant number of units being sold may require serious renovations. What efforts will the city make to ensure that the units being sold are in an adequate state? Replacement of rental stock: public rental stock is a key avenue for the people to find subsidised affordable housing in an urbanising metro. It is critical that the city does not lose sight of providing state-supported rental.
Will these 9 000 units be replaced with social housing or affordable rental units?
There are serious concerns around the city’s ability to manage its rental stock, particularly its ability to collect rent from tenants. Because the city is unable to collect rent on these properties, ownership cannot be the solution. Instead, in-depth analysis of the challenges and opportunities with the public management of rental stock must be conducted. Gentrification/market-led displacement is a threat to the beneficiaries, especially their ability to remain homeowners. A significant proportion of them have intermittent income, and the tenure security will shift from rental to ownership.
It is DAG’s hope that the City of Cape Town intends to make the necessary mitigation measures.
While the city’s offer is a positive step, it should be done in a manner that is fair and just.
There are many lessons in relation to the failure of housing programmes, especially with low-cost, government-subsidised housing ownership programmes.
It will be important for the city to bear these lessons in mind when rolling out this initiative.
Saal is a seasoned human rights researcher, skilled in quantitative and qualitative research, policy analysis and project impact evaluations. Kumar is executive director of DAG. Over the last 15 years, he has worked on post-disaster, post-conflict and informal settlement upgrading across the world.
Matiashe is a trained spatial planner. He currently serves as DAG’s lead researcher on small and mediumresearch projects related to housing and urban development