Cape Town - The Western Cape government has welcomed the announcement by the National Minister of Human Settlements, Mmamoloko Kubayi, during a virtual briefing to the National Council of Provinces (NCOP) that the Finance Linked Individual Subsidy (FLISP) has been delinked and is no longer a mortgage-only option.
This means that as of April 1, persons who in the past could not qualify for FLISP due to them not qualifying for a home loan or mortgage will now be able to use other sources of finance to acquire a property.
According to the ministry, residents with a household income of R3 501 to R 22 000 a month will be able to access FLISP through a pension/provident fund loan, a co-operative or community-based savings scheme (stokvel), the Government Employees Housing Scheme, any other employer-assisted housing scheme, an unsecured loan and even an instalment sale agreement or rent-to-own agreement.
The Western Cape Human Settlements Ministry says that there has been a huge increase in FLISP applications and approvals, with 3 695 applications approved by the Western Cape Department of Human Settlements (WCDoHS) since April 2020. This was against a target of 1 800 between the 2020/21 and 2021/22 financial years.
“This is exceptional news and a game-changer for the affordable housing market. We have been advocating for this revised FLISP for years and this is a true victory,” said Marcellino Martin, spokesperson for MEC Tertuis Simmers.
“We’ve also partnered with external role-players such as financial institutions, conveyancing attorneys and property developers, and granted them access to the Housing Subsidy System (HSS), which allows them to capture and monitor the progress of applications, which drastically improved the turnaround times for processing these applications,” he said.
Martin said they anticipate an influx of applications, which is why they are streamlining the system so that there are no unnecessary and avoidable delays.
“With approximately 70% of our people employed, we understand that there are many that will never qualify for a fully state-subsidised home, yet they still require some form of assistance from the state,” he said.
“As the Western Cape government, we remain committed to accelerating human settlements delivery while promoting social inclusion through the development of integrated, resilient, safe and sustainable human settlements in an open-opportunity society,” he said.
IOL