Minister Madikizela at the Launch of Morgen's Village Phase 3
Master of ceremonies: Mr Samson Moraba
Mayor of Cape Town: Mr Dan Plato
CEO of Cape Town Community Housing Company: Mr Fungai Mudimu
National Minister of Human Settlements: Mr Tokyo Sexwale
National Deputy Minister of Human Settlements: Mrs Zoe Kota Fredericks
Honorable Minister, Mayor, Colleagues and Community Members
Ladies and Gentlemen,
Thank you for the opportunity to address you at today's launch of the Morgen's Village Phase 3 opening. Today marks the official launch of another 341 units in Morgen's Village, complementing the 330 units already delivered in Phase 1 and 2.
I am very excited about this project, as it demonstrates that people earning less than R3 500 can afford to pay off a small bond. If you look around you, you can see that the houses in Morgen's Village are double storey, and are of a higher quality than our standard government-subsidised housing projects, which limit expenditure to what the subsidy provides.
People here don't just have houses, they have very nice houses, houses they can be proud of, and houses which they themselves are contributing towards financially. This can only result in a greater sense of ownership among beneficiaries.
These houses have been made possible by a new model of funding and by key partnerships between the City of Cape Town, the Cape Town Community Housing Company, the Provincial Government of the Western Cape and the National Housing Finance Corporation. In Morgen's Village, the government housing subsidy was topped up with a loan from the Cape Town Community Housing Company. This top-up amount is then repaid over 20 years, and after the 20 years, the homeowners will have an asset worth approximately R240 000, whereas they only have to invest R92 000.
In Morgen's Village, there is a sense of pride among the homeowners. Through recognising their ability to help pay off their homes, we recognise their financial power and we also see them having a sense of real responsibility for their homes. As we all know, we usually appreciate the value of, and care more for, things that we have to pay for, instead of the things we are just given. The community has also been involved in the project from its beginning in other than financial ways. Monthly meetings have been held with the community, and they have been involved in the design and the planning.
Besides being very happy for the proud new homeowners, I am excited that this project has demonstrated that people earning below R3 500 a month can contribute to good housing and receive good houses. My vision is that this model should be expanded into servicing the gap market of people earning between R3 500 and R7 500 a month. People earning in this range qualify for partial government housing subsidies.
We are all aware that the private banking sector has been hesitant to provide home loans to households earning less than R12 000 a month. I know that the NHFC is finalising the details of a finance scheme to address issues of risk and affordability in the gap market. But I believe that, together with those systemic interventions, expanding projects such as this into the lower end of the gap market will help crowd the private sector into this under-serviced market. I hope that we can rely on the NHFC and the CTCHC to play a prominent role in achieving this expansion in the Western Cape.