There can be no arguing against the fact that provision of affordable housing is a vital component of the social transformation and empowerment efforts of local and national governments across South Africa.
Affordable housing can no longer be just about providing shelter. It must now come of age, and realise the immense potential it has to also deliver quality of life, opportunities, equality, and dignity for all South Africans, says Govender.But, while much admirable work is being done to put roofs over the heads of increasing numbers of South Africans, Leanne Govender, sales manager at Nedbank says true redress in the area of human settlements requires that stakeholders go beyond merely erecting masses of low-cost houses.
“The truth is, if we want the delivery of housing opportunities to be truly transformative for beneficiaries, affordable housing developments need to start offering the individuals, families and communities that inhabit these housing units at least some of the comforts and benefits that have previously been reserved for homeowners of greater means,” says Govender.
She says for Nedbank Corporate and Investment Banking (NCIB), the inclusion of sustainability components, and particularly energy-efficiency benefits, is the logical place to start with the transformation of South Africa’s affordable housing sector.
“Our long-standing funding partnership with private equity firm, International Housing Solutions (IHS), is a good example of how it is possible to build sustainability into affordable housing, and how beneficial this can be for those who take up residence in these sustainable, affordable homes,” says Govender.
“As part of our ongoing commitment to doing our share to get more South Africans into homes, the Nedbank Affordable Housing Development Finance division has been one of the key finance providers to IHS for the past five years. In 2016 alone, we disbursed over R500 million in funding for several of its SA-based affordable housing developments and acquisitions.”
Govender says the approach also prioritises human settlements over mere housing development, and a percentage of the finance provided by Nedbank and other IHS financiers goes towards the development of infrastructure that enhances residents’ lifestyles, including roads, security and communal areas.In that time, Govender says IHS has delivered more than 27 000 affordable homes, many of which were made possible by Nedbank’s finance solutions. These include the Candlewood development in Ravenswood, Boksburg, and the acquisition of 253 sectional title units in Glenhaven, Cape Town, including 368 units in Ormonde, Johannesburg South, and 180 units near the Gautrain station in Grand Central, Midrand, still to be completed.
While the primary focus of these IHS developments is on the provision of much needed housing for lower- to middle-income earners, Govender says the appeal of CIB’s funding relationship with IHS was significantly enhanced by the fact that IHS places a particular focus, within its Fund II projects, on the efficient use of energy, water and materials in the funded dwellings.
Importantly, she says this sustainability focus is not only for the building phase of the project, but is also aimed at creating healthier living environments and reducing long-term energy costs for owners and tenants.
“Our experience in this regard has shown that increasing adoption of EDGE certification is critical to the development of a sustainable affordable housing market in South Africa. Meeting the EDGE standard requires the achievement of at least 20% savings, as measured by the EDGE software, in the three dimensions of energy, water and embodied energy in building materials,” says Govender.
Govender says IHS has delivered more than 27 000 affordable homes, many of which were made possible by Nedbank’s finance solutions. These include the Candlewood development in Ravenswood, Boksburg, and the acquisition of 253 sectional title units in Glenhaven, Cape Town, including 368 units in Ormonde, Johannesburg South, and 180 units near the Gautrain station in Grand Central, Midrand, still to be completed.She says while energy- and water-efficient affordable housing is still in its infancy in SA, early indications are that the inclusion of these sustainability components in the design of low-cost houses could cut the utility costs of the people living in them by as much as 20% per year. And given that electricity and water prices are set to rise significantly in the coming years, these savings represent immense value, particularly for lower- and middle-income households.
According to Govender, another imperative for transformative social housing is that it provides tenants and owners with access to amenities and arguably more importantly, opportunities.
Here too, she says, the IHS model is delivering real value to new homeowners. The affordable housing developments within its Fund II category typically comprise a combination of one, two or three bedroom units, situated as close as possible to essential amenities, including schools, shopping centres and transport hubs.
Govender says the approach also prioritises human settlements over mere housing development, and a percentage of the finance provided by Nedbank and other IHS financiers goes towards the development of infrastructure that enhances residents’ lifestyles, including roads, security and communal areas.
According to Govender, given that majority of residents in these developments report an enhanced quality of life, better safety, access to education and employment, reduced transport and utility costs and a greater sense of financial security due to property ownership and security of tenure, client relationships like the one Nedbank Affordable Housing enjoys with IHS must, of necessity, become the norm rather than the exception, within the SA social housing sector.
Affordable housing can no longer be just about providing shelter. It must now come of age, and realise the immense potential it has to also deliver quality of life, opportunities, equality, and dignity for all South Africans, says Govender.
