Minister of Human Settlements Water and Sanitation, Lindiwe Sisulu, has called on those who are seeking to buy a home or property for the first time to apply to the Finance Linked Individual Subsidy Programme (FLISP) provided by government to encourage home ownership for those who earn between R3501 – R22 000.
The applicants must have been approved for a home loan by an accredited banking institution or a non-bank financial institution.
This government financial assistance for middle-income earners can be used as a deposit or to reduce the bond balance.
The once-off financial assistance for qualifying beneficiaries ranges from R27 960 to R121 626, depending on the level of household income.
“We have designed this subsidy to assist low-income workers both in the private and public sectors. I have directed National Housing Finance Corporation (NHFC) or Human Settlements Development Bank (HSDB) to make sure that they have a call centre and capacity to process all applications and to go on a roadshow to educate the public about this subsidy. This subsidy is to encourage home ownership among our teachers, factory workers, receptionists, nurses and police among others,” says Sisulu.
Sisulu says a budget of R461-million has been set aside for this financial year.
This is expected to benefit 7 600 qualifying beneficiaries and leverage about R3.2-billion from the private sector financial institutions.
“Our resolve to restore the dignity of our people through human settlements goes beyond us giving fully subsidized houses to the indigent. We are also committed to responding to the housing needs of our middle-income earners through FLISP. We call on our people to seize this opportunity and apply for financial assistance.”
During the 2020/2021 financial year, the HSDB processed 2 815 applications and of these, 2 120 were approved with a total value of R111-million and this has triggered over R1-Billion home loan approved by different banking institutions on the back of R111-million. For the year, over R60-million has been disbursed to 1 136 beneficiaries.
Sisulu says progress to develop the policy to enable the non-mortgage applicants to benefit from the programme is at an advanced stage and is expected to be concluded in the next few months.
This will see people mainly in the rural areas applying for financial assistance to add to their home loans to build their own homes.
Government also says the NHFC is in the process of signing a number of service level agreements with banking institutions as well as signing the Memorandum of Understanding (MOU) with Banking Association of South Africa (BASA), once the policy is approved in few months.