Cape Town - The Western Cape Department of Human Settlements (WCDoHS) has enlisted the help of the National Housing Finance Corporation (NHFC) to address the backlog of payments for the finance linked individual subsidy (Flisp).
The department has approved 3 695 Flisp payments since April 2020, which has amounted to R61.47 million for the 2020/21 financial year, while over R53 million in payments has been made for the 2021/22 financial year.
The department has a target of assisting 900 individuals during a single financial year, however applications have run above this amount. Currently the backlog for the 2020/21 financial year is at 326, while the backlog for the 2021/22 financial year is at 1395.
They have thus entered into an agreement with the NHFC in order to meet demand. This agreement will see an additional 1 000 subsidies taken up by the end of March 2022.
The balance of the outstanding subsidies will then be paid out in the year 2023.
Human Settlements MEC Tertuis Simmers said: “The continued rise in demand to be assisted through Flisp confirms why our strategy in the Western Cape to focus on creating affordable housing opportunities is the correct one to follow.
“We understand that there are many that will never qualify for a fully state subsidised home, yet they still require some form of assistance from the state,” Simmers said.
The department has also submitted its final input for the revision of Flisp, which will see the policy de-linked from being a mortgage-only option. This means that a bond approval would no longer be the only requirement for those in the affordable housing market to access Flisp.
Spokesperson Marcellino Martin said: “We have a big issue with people having poor credit records and because people have poor credit records the banks won’t give them a home loan. You might earn enough but you have a poor credit record and because of that you can’t access Flisp.
“In it’s current form you need that home loan before you can think about accessing Flisp, so that is one of the reasons why we are encouraging the national government to expedite the process,” Martin said.
Flisp is a subsidy that assists first-time home buyers within the affordable housing market to become property owners. Households with an income between R3 501 and R22 000 may qualify for the Flisp subsidy if they meet all the qualifying criteria.