The City of Cape Town’s Affordable Housing Initiative
The City of Cape Town has announced plans to provide 12,000 affordable housing units. This initiative aims to address the pressing need for accessible housing in the region. To understand the scope and implications of this project, it is essential to explore what “affordable housing” means, where these homes will be built, and when they are expected to be completed.
The Need for Affordable Housing
Cape Town faces a significant challenge in meeting the housing demands of its population. Over 400,000 individuals are on the city’s housing waiting list, and nearly half of the households earn less than R20,700 per month. This economic disparity highlights the urgent need for affordable housing solutions that can accommodate low-income families.
For over a decade, housing activists from groups like Ndifuna Ukwazi and Reclaim the City have advocated for the development of affordable housing in the inner city. Their efforts have led to court judgments compelling the government to prioritize affordable housing when selling state-owned land. In 2022, Mayor Geordin Hill-Lewis introduced an “accelerated land release programme,” aiming to develop City-owned land into affordable housing. However, despite the release of eleven land parcels in the last two years, no construction has commenced on any of these sites.
Defining Affordable Housing
The City Council has established a clear definition for “affordable housing.” It refers to homes intended for households earning less than R32,000 a month. The 12,000 units in the pipeline fall into several categories:
- Social Housing: The City sells land to developers who receive a one-time subsidy from the Social Housing Regulatory Authority (SHRA) to build apartments. These are rented to low-income families, with rental caps set at R7,326 per month.
- Open-market “affordable housing”: Developers build homes for households earning under R32,000, though the specifics of this model are still being finalized.
- Gap Housing: State-subsidized houses available for purchase to those earning less than R22,000.
Other models, such as Breaking New Ground (BNG), provide free housing but do not align with the City’s affordable housing criteria.
Current Progress and Challenges
To date, only social housing units have been constructed. There are 4,849 social housing units, with just 855 located within a ten-kilometre radius of the city center. Some existing developments have faced issues, including rental boycotts.
The City’s 12,000-home pipeline includes 21 land parcels, potentially yielding 14,020 housing units. However, not all will meet the affordability criteria. At least 2,741 units will be social housing, 916 will be Gap housing, and 683 will be open-market affordable housing. The remaining units will consist of a mix of affordable and high-end options, with at least 7,660 needing to be affordable to meet the goal.
Location and Development Plans
Of the 21 developments, ten will be within a ten-kilometre radius of the city center. Other planned developments are in economic hubs such as Bellville, Century City, Montague Gardens, Paarden Eiland, and the southeast corridor linking Khayelitsha and Mitchells Plain with Claremont and Wynberg. Two developments are planned for Atlantis, 55km from the city center, which is considered an area with industrial opportunities.
Critics argue that affordable housing is being developed on the city’s periphery, far from job opportunities. However, Mayor Hill-Lewis contends that all planned developments are near important economic nodes. Human settlements MEC Carl Pophaim emphasized that communities away from urban centers should not be overlooked.
Delays and Obstacles
Construction has yet to begin on any of the 21 sites. Seven sites have appointed developers, while 11 are still in the land release process. At the Salt River Market site, relocation of residents is required before development can proceed. Funding from the SHRA has not been approved, leading to delays.
At Pine Road and Dillon Lane in Woodstock, development has not started due to financial and planning challenges. The largest social housing project in Pickwick Street was awarded to Instratin in 2023, but recent reports suggest maintenance and security issues. SHRA has discontinued support for three of Instratin’s projects, raising concerns about the funding prospects for the Pickwick Street development.
Funding constraints at the SHRA have also impacted progress. A budget cut of R315-million over three years has forced the agency to focus on unlocking stalled projects and supporting funding restructures.
Conclusion
The City of Cape Town’s affordable housing initiative represents a significant step toward addressing housing inequality. However, numerous challenges remain, including delays in construction, funding issues, and concerns over the location of new developments. As the project progresses, continued monitoring and adjustments will be necessary to ensure that the 12,000 affordable housing units meet the needs of the city’s residents.
