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General Finance

How to get a housing subsidy in South Africa

Shelter is one of our basic needs, we can’t survive without proper shelter. Housing is very expensive. It is arguably the most expensive purchase that most people have to make in their life. This is a guide on how to get a housing subsidy in South Africa.

South Africa is a developing economy that is very unequal, over 50% of people have a monthly income of less than R1 500. This means that getting a house can be very difficult for the majority of South Africans. Proper housing usually costs way over R100 000. The government has come up with a housing subsidy plan that aims to help people that earn anywhere from under R3 500 to R22 000.

Government subsidy housing

This is a housing scheme that is aimed at lower income earners. Also known as RDPs, there are certain requirements that you must meet to qualify for an RDP house.

  • An income of less than R3 500 per household, households that earn more than R3 500 per month don’t qualify.
  • This should be the first time you are receiving a government subsidy.
  • You are married or living with a long-term partner / or you are single or divorced with others who rely on your income.
  • A South African citizen.
  • You are married or living with a long-term partner / or you are single or divorced with others who rely on your income.
  • You are married or living with a long-term partner / or you are single or divorced with others who rely on your income.
  • You or your partner have never owned property.

People who are disabled or over the age of 40 will be prioritized and single people with no dependants can also apply if they are senior citizens or disabled. If your monthly household income is less than R3 500, you qualify for a subsidy of R160 573. Note: You don’t have to repay this subsidy as it isn’t a loan. Which can be used to buy an existing house.

Finance Linked Individual Subsidy Programme (FLISP)

This is a housing subsidy for first-time home buyers to assist with the purchase of a home. You need to have a household income between R3 500 and R22 000 to be considered for this subsidy. This subsidy is paid out straight to your bank or financial institution. It can be used as a down payment or a way to reduce your mortgage term.

You can use this subsidy to purchase an existing home, or a vacant residential stand (plot) or build a new house. The amount of money that you receive ranges between R27 960 – R121 626, depending on the income of the applicant. Here are some of the requirements.

  • You earn between R3 501 to R22 000.
  • You are a South African citizen or have permanent residency in South Africa.
  • You have not received a government housing subsidy before.
  • You have not owned fixed residential property before.
  • You are competent to contract – over 18 years.
  • You are married or cohabiting.
  • You are single with financial dependents.

You have to be approved for a mortgage loan from the bank before you apply for this subsidy. Your application won’t be successful if you were not approved for finance by the banks or financial institutions.

Conclusion

You need to fill out a  form at the department of human settlements to apply for these subsidies. Do you have any thoughts or questions? Comment below.

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