Infrastructure

1. Where the Department has been able to adopt an updated affordability threshold, it has. The first example of this is in the land release and tender process for the PPTL site. Here the Financial Sector Code definition has been used as a threshold in defining “affordability”. The revised threshold cannot be applied across all programmes, as the First Home Finance programme and the Social Housing Programme are governed by the National Housing Code, and hence the National Department of Human Settlements’ current national policies.  
2. (a) First Home Finance: The Department has advocated at the National Department of Human Settlements’ First Home Finance Champions Forum for the increase of the income threshold to that of the Financial Sector Code definition. Furthermore, is has requested this adjustment as part of the submitted Multi-Year Housing Development and Human Settlement Plan 2024/2025 - 2028/29. This adjustment however has not yet been adopted by the National Department.     

(b) Social Housing: The Department is an active member of the National Policy and Research Task Team. The Department has been advocating for an adjustment to threshold income of R22 000 to be aligned with the Financial Sector Code (FSC) definition. This has recently again been included in formal comment provided on the proposed Reformed Social Housing Policy Programme that was submitted to the National Department in February 2026.

3. The Department does not keep a demand database of households in the province that currently fall into the income bracket between R22 000 and R 34 800, as this falls outside any of the existing National Housing Programmes. However, the Department, in conjunction with the provincial Department of Environmental Affairs and Development Planning, have undertaken the Western Cape Housing Market Demand Studies in 11 selected study areas in the following municipalities between 2024 and 2025:- Bitou (Plettenberg Bay and surrounds); Breede Valley (Worcester); Drakenstein (Paarl and Wellington); George (City of George); Knysna (Knysna town and Sedgefield); Mossel Bay (Mossel Bay town and Hartenbos); Oudtshoorn (Oudtshoorn town); Overstrand (Greater Hermanus, Kleinmond, and Greater Gansbaai); Saldanha Bay (all urban subplaces); Stellenbosch (Stellenbosch town) and Swartland (Malmesbury and Abbotsdale, Moorreesburg, Darling, and Riebeek-Kasteel).

The purpose of these studies has been to analyse the housing market effectively. The market is divided into distinct but interrelated components. This structure supports an understanding of housing demand and supply characteristics, how broader contextual factors shape the market, how it currently functions, and whether it meets the needs of different income groups. The studies included a ‘gap analysis’ which identifies mismatches between income-based demand and available supply. It estimates what different households can afford and compares this to what is being delivered across market segments. From these studies is has been determined that approximately 58 000 households fall within the income range of R22 000, to just above of the current FSC definition, to a monthly income of approximately R 36 600.

4. (a)(i)(ii) The Department does not record or monitor the average rent or bond repayments being charged in provincially supported affordable housing developments. These amounts are regulated by the Social Housing Regulatory Authority (SHRA) for the social housing projects, and by the various financial institutions extending end-user finance to first home buyers, in terms of the National Credit Act (NCA).
5. Due to the nature of the regulation of the rental and bond repayments, by the various entities and institutions, these amounts would therefore typically be within the stated affordability benchmarks.  
6. The Department has not conducted any recent study on whether households earning between R3 500 and R22 000 can realistically afford housing near economic opportunities in Cape Town. The most recent work undertaken has been by the City of Cape Town in terms of the 2025/26 review of the City’s Integrated Human Settlements Five-Year Sector Plan 2022/23 – 2026/27.
7. The Department does not have record of social housing tenants’ income, expenditure profiles and what percentage is spent on rental. All the social housing projects are regulated by the SHRA. This includes regular quarterly reporting by all the Social Housing Institutions (SHIs) or Other Delivery Agents (ODAs) at a portfolio and project level. Furthermore, the SHRA undertakes beneficiary verification processes at the time of unit occupation to ensure that rentals remain with the required quotas and affordability benchmarks.

A detailed affordability determination is required for each individual application that is made, be it for a social housing rental unit, or a FHF units that is being sold. An income and expenditure profile/ statement is required for each application. Transport costs are therefore included, as all expenses need to be accounted for. This is to ensure that a household is in fact able to afford the relevant accommodation, and that the cost thereof does not exceed the required benchmarks.