FNB cites major issues hampering the growth of the affordable housing sector in South Africa
In response to a target set by the South African Minister of Housing, Tokyo Sexwale, stating that banks should grant up 600,000 housing loans in the next three years the CEO of FNB Housing Finance, Marius Marais, said that there many issues the government needs to address in order to make the target possible.
Some of the major issues that FNB cited include:
Provision of a state back mortgage insurance fund that would cover the risk banks could face against defaulting clients. In principle, this is something already under discussion. In his State of the Nation address in 2009, President Zuma promised the launch of a R1 billion (about US$143 million) guarantee fund for borrowers who were “too rich for the subsidy and too poor to access mortgage finance”. Both the Ministers of Finance and Human Settlements repeated this promise. No policy proposals have been forthcoming however.
Provision of a fund to assist in the delivery of infrastructure, such as, roads, water, electricity and sanitation. This is a critical issue and something that National Treasury has already resolved to address.
A need for government to secure land efficiently. This is within the mandate of the Housing Development Agency, formed 2008.