July 23, 2024
South Africa: MEC Tertuis Simmers hands over Rent-to-Own Mill Park Development to first-time homebuyers
South Africa: MEC Tertuis Simmers hands over Rent-to-Own Mill Park Development to first-time homebuyers
– By Alison Godswill

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South Africa: MEC Tertuis Simmers hands over Rent-to-Own Mill Park Development to first-time homebuyers

On Tuesday, first-time homebuyers at the Mill Park Development in Bredasdorp received their house keys. Officiating the handover was the provincial MEC of Infrastructure, Tertuis Simmers, and the Cape Agulhas Executive Mayor, Paul Swart.

The R55 million Mill Park Development is envisaged to create 106 affordable housing opportunities for residents of Bredasdorp and the broader Cape Agulhas municipal area. The sod turning for this project took place in June 2022, and the handover of the first 22 homes will be phased over three weeks.

In attendance were beneficiaries of this pilot project who applied through the rent-to-own option. This option allows applicants to rent for up to 36 months, during which time prospective buyers will be assisted in improving their credit records and affordability. After 36 months, the purchase is done through the First Home Finance subsidy.

Mrs. Goss whose son qualified through the rent-to-own option, said: “I am grateful that my son has been granted this opportunity to purchase a house for our family to move into. This subsidy by the government allows the youth to become homeowners at an early age and eases the burden on parents from worrying about their children’s future and credit management.”

Residents earning a gross monthly income of R3,500 – R22,000, and who qualify for a First Home Finance subsidy, receive financial assistance that serves to reduce their monthly bond installment, making it more affordable to acquire their first home. In addition, the Mill Park project supports prospective but financially impaired home buyers by offering the Housing Consumer Education Programme. The programme is aimed at individuals whose credit records can be regularized within a period of 6 to 24 months. These would mainly include cases with minor judgments, marginal credit reports, and affordability constraints.

Part of this initiative is the ‘My Budget Fitness’ Programme. It provides:

  • an advisor offering one-on-one financial mentorship;
  • compilation of a household budget and assisting prospective homebuyers in adhering to the programme;
  • monthly progress reports;
  • improving Credit Worthiness; and
  • dedicated support in approaching a financial institution for a mortgage loan and obtaining a First Home Finance subsidy (if applicable).

The provincial MEC commended the innovative collaboration with the Cape Agulhas Municipality in implementing this pilot project. MEC Simmers said: “Through this project, we have showcased that we can push the boundaries of innovation. I want to thank Mayor Swart and his team for partnering with us on this project and for the leadership shown in making this project a reality. We will continue to seek alternative ways of making homeownership more affordable and accessible to all citizens.”

This first-of-its-kind project has generated interest from residents across the Western Cape and beyond. The Department of Infrastructure is in the process of seeking to expand this pilot into other municipalities.

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