Individual Housing Subsidies

Description:

Individual housing subsidies are available to low-income households, where an applicant wishes to buy a residential property for the first time. The subsidy can be used to buy an existing house - including the property on which the house stands. It can also be used to buy a house on a plot-and-plan basis, or to finish an incomplete house. Successful applicants will receive this subsidy only once. It is not a cash pay-out, but is paid directly to a financial institution or a conveyancing attorney.

Instructions:
  1. Who can apply for an Individual Housing Subsidy?
  2. How much is an Individual Housing Subsidy worth?
  3. How do I apply for an Individual Housing Subsidy?
  4. What documentation must I supply when applying for an Individual Housing Subsidy?
  5. How is the Individual Housing Subsidy paid out?
  6. Will I have to pay anything back?
  7. Who to contact to check the status of your subsidy application?
  8. Where can I find more information?

Who can apply for an Individual Housing Subsidy?

You qualify for a housing subsidy if ALL of the following statements are true:

  1. I am married or cohabiting with a long-term partner - if you are married or cohabiting, it does not matter whether you have financial dependents or not.
    OR
    I am single or divorced with financial dependents.
  2. I am a South African citizen.
    OR
    I have a South African Permanent Resident's Permit.
  3. I am over 18 years of age.
    OR
    I am under 18 years of age and married or divorced with financial dependents.
  4. I am of sound mind.
  5. My gross monthly household income is less than R3 500.
  6. I have never received a subsidy from the government, and neither has my partner.
  7. I have never owned property, and neither has my partner.
  8. My family and I will live on the property bought with the subsidy.

If you answer "true" to all of the above, then you are probably eligible for a housing subsidy. In addition to the above, single persons without financial dependants; such as the aged, disabled etc. may be assisted.

You cannot apply for a housing subsidy if you have received a subsidy or housing assistance from the government before. But you can get a subsidy if you received a land grant.

How much is an Individual Housing Subsidy worth?
  • If your household income is less than R3 500, you are eligible for a subsidy of R160 573. You do not have to repay this subsidy as it is not a loan.
  • If you can prove that you are disabled or health stricken, as long as your household income is less than R3 500, you are eligible for a housing subsidy of R160 573, plus a set disability variance amount to pay for the cost of any extra features your house may need, for example, a ramp for wheelchair access.

How do I apply for an Individual Housing Subsidy?

There are two kinds of Individual Housing Subsidies, based on whether you can pay your contribution to the house out of your savings, or if you need to borrow money to pay for it.

  • A Non-Credit-Linked Individual Subsidy is what you get if you can pay your contribution, in full, out of your pocket. To apply for a Non-Credit-Linked Subsidy, you will need to fill out an application form at the Department of Human Settlements at 27 Wale Street in Cape Town, or visit your local municipal offices.
  • A Credit-Linked Individual Subsidy is what you get if you cannot afford to pay your contribution, in full, out of your savings and need to do so using a loan from a bank or some other financial institution. You will need to be pre-approved for credit with an approved financial institution before you can apply for a Credit-Linked Subsidy at the Department of Human Settlements at 27 Wale Street in Cape Town, or at your local municipal offices.

What documentation must I supply when applying for an Individual Housing Subsidy?

The following documents are required when the completed application form is returned:

  1. A certified copy of your bar-coded South African ID, and that of your partner or spouse, and the certified birth certificates of your financial dependents (see Applying for a Birth Certificate if you have lost your dependents' birth certificates). Please note that you will be asked to provide the ID numbers of your financial dependents.
    OR
    A certified copy of your Permanent Residency Permit if you are not a South African citizen, plus those of your partner or spouse and dependents.
  2. A certified copy of your marriage certificate, if you are married.
    OR
    A certified copy of your divorce decree, if you are divorced with financial dependents.
  3. An original recent payslip as proof of income. If unemployed, an affidavit confirming unemployment is required.
  4. If you are applying for a Non-Credit-Linked Individual Subsidy, you will need to supply a certified copy of the signed agreement of sale for the property. Be sure to make the sale conditional to your receiving a housing subsidy AS WELL AS a certified copy of the seller's title deed.
    OR
    If you are applying for a Credit-Linked Individual Subsidy, you will need to supply a certified copy of the signed agreement of sale for the property. Be sure to make the sale conditional on your receiving a government housing subsidy AS WELL AS a house bond. You will also need to provide proof that the house bond has been approved.

Note: If this Department has previously subsidized the property being purchased, the applicant must provide an affidavit stating whether he or she is in any way related to the seller.

How is the Individual Housing Subsidy paid out?

  • A housing subsidy is not a cash pay-out but is paid directly to the financial institution from which you are receiving a housing bond (in the case of Credit-Linked Individual Subsidies) or the seller (in the case of Non-Credit-Linked Individual Subsidies).
  • To prevent fraud, in cases where a homebuyer has to make a contribution to the cost of a house, the government requires that this contribution be paid in full before the subsidy is paid out.

Will I have to pay anything back?

  • The housing subsidy is not a loan and you do not need to pay it back.
  • If you have a Credit-Linked Subsidy, you will have to pay back your loan to the financial institution that gave it to you.

Who to contact to check the status of your subsidy application?

The Subsidy Administration Section can be contacted directly for further assistance or details regarding the status on your subsidy application. This can be done either telephonically or through an e-mail.

Where can I find more information?

 

Department of Human Settlements
27 Wale Street
Cape Town

Helpdesk

Call 021 483 6488 / 3112 / 0611/ 8984

Office Hours

07:30 and 15:00, Mondays to Fridays.

Provided by:
Government Body: (Western Cape Government)
The content on this page was last updated on 2 June 2014