Construction will soon start on the first affordable housing development in upmarket Umhlanga near Durban. The Mews, comprised of 477 sectional title units, will also be the first development in the province of KwaZulu-Natal financed by International Housing Solutions, the global private equity funder of affordable housing, which has to date financed projects with a combined total value of more than R7.8 billion in South Africa’s major urban centres.
“IHS got involved in this development as it will be a first of its kind for this area. There has not been a substantial amount of development in the affordable space in Durban like we have seen in Gauteng and the Western Cape in the last 12 months,” says Joel Rosen, deal originator at IHS.
“The development is especially exciting since it will form part of the Gateway precinct in Umhlanga, giving an opportunity to those who would previously not have been able to afford property in the area, to own an apartment,” Rosen says.
Gap housing, or affordable housing, services the section of the market which does not qualify for free RDP homes but which also does not earn enough to qualify for a bond at the mid-to-higher end of the market. The affordable housing sector has risen to prominence lately, following President Jacob Zuma’s announcement that R83.5 billion in housing subsidies would be made available to enable low-to-mid income earners to take a step onto the housing ladder.
Rosen says that The Mews will have similar amenities to other, more expensive developments in the area, including pool areas. This is set to make units attractive investment options.
“As demand for affordable housing units continue to outstrip supply, we have no doubt that demand for this attractive development will be insatiable,” he says.
The development, constructed by Avoca Developments, will consist of multi-storey blocks with a focus on a lifestyle living environment. Units will vary in size from units of 37m2 up to units of 55 m2.
It will also include 61 ‘inclusionary units’ to incorporate a social housing aspect. Units will be launched in July 2012, and the first phase is expected to be ready for occupation within 12 months.
“We are very excited about being able to expand SA’s affordable housing footprint to KwaZulu-Natal,” says Rosen.
“As was confirmed in the recently released Social Impact Report on the Derived Social Benefits of Occupying Affordable Housing in South Africa, tenants and owners of affordable housing units built by IHS in the past 2 years have overwhelmingly reported improvements in their quality of life and access to amenities.
“We are proud that we will be able to expand these opportunities to another important SA economic hub, and that we can continue to grow sustainable communities that improve the quality of people’s lives and transform their options from mere shelters into owning an asset that generates wealth by increasing value.”
For more information on affordable housing in South Africa or IHS, its developments and strategies, go to http://www.ihsinvestments.co.za.