City of Joburg reserves a third of new housing for low-income earners

26 February 2019 - 07:22
By Cebelihle Bhengu
The new inclusionary housing policy is to ensure that more people are able to afford accommodation in the city centre.
Image: Waldo Swiegers/Bloomberg via Getty Images The new inclusionary housing policy is to ensure that more people are able to afford accommodation in the city centre.

The City of Johannesburg is to compel private-property developers to dedicate 30% of their new developments to low-income earners.

This applies to all developments to be built in areas within the jurisdiction of the City of Joburg's municipality. 

The city adopted their inclusionary housing policy last week and the isolation of low-income earners from the city will soon be a thing of the past, officials insist.

The goal of the policy is to do away with inequality by ensuring the integration of people who fall into different income brackets and different race groups into the city centre. This should have an ongoing effect into the inner city's amenities and businesses as well as on job opportunities.

The policy will apply  to developers who will have developments of 20 residential units or more. 

The policy does not limit the accommodation of low-income earners to specific areas only, which means that developers who take up projects in more affluent areas of the city will still be compelled to abide by the policy.

According to Moneyweb, some property developers were critical of the policy. The South African Property Owners Association lamented the city's disregard of the concerns they had brought forth at the proposal of the policy last year.

Property developers have four options for inclusionary housing to choose from, including setting aside 30% of the entire development to social housing, finance-linked individual subsidy (Flisp), or capped rent.

With this last option, the city says rent will be capped at R21,000 (in 2018 prices) for people earning R7,000 a month or less. 

The policy will be effective as of May 2019.