Infrastructure
(1) Whether the concept of “rent to own” is an option open to the public; if not, why not; if so, what are the relevant details;
(2) whether the rental option of “rent for life” without the option of ownership is an option open to the public; if so, what are the relevant details?
[1] The deferred ownership, or “Rent-to-Own” concept, is being piloted by Cape Agulhas Municipality in the Mill Park development in Bredasdorp. The project is open to the public, however potential beneficiaries for the project are required to reside in the Cape Agulhas Municipal area as the project is being developed by the Cape Agulhas Municipality.
The project is part of the Help Me Buy a Home programme where households with an income between R3 501 to R22 000 per month may qualify for the FLISP subsidy if they meet the relevant criteria.
If a prospective purchaser is considered creditworthy, they will be assisted to apply for a mortgage bond and a FLISP subsidy to buy their first home. If they are not able to qualify for a mortgage bond due to their credit score, they can register for the “Rent-to-Own” option. This will allow them, as a prospective homebuyer, to rent a new house for 24 months, after which they will have the option to purchase the property. If their credit score is too low, they may not qualify immediately and first have the opportunity to improve their credit score and affordability.
The “Rent-to-Own” option includes a support programme that will support purchasers to improve their creditworthiness during the rental period. Once their credit score has improved adequately, they will be assisted to apply for a mortgage bond and a FLISP subsidy for purchasing their new home.
[2] There is no concept, or rental option, called “rent for life”. Programmes which cater to permanent rental [which will not translate to ownership] are the Social Housing Programme and the Community Residential Units Programme.
