The Stellenbosch municipal building with the adjacent Town Hall building on the left. Picture: Ian Landsberg/African News Agency/ANA
The Stellenbosch municipal building with the adjacent Town Hall building on the left. Picture: Ian Landsberg/African News Agency/ANA

Housing body smells rat in pricing structure of Stellenbosch housing project

By Mwangi Githahu Time of article published Jun 24, 2019

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Cape Town - The Idas Valley Housing Forum is smelling a rat in the pricing structure of a developer of a subsidised housing project.

In a memorandum to the Mayor of Stellenbosch municipality, Gesie van Deventer, the community asked: “Does the Stellenbosch Municipal Council work in the interest of the developer (ASLA Construction), or that of the community it is supposed to represent in negotiations or dealings with outside parties?”

According to the committee’s letter, dated January 2019, “at a meeting called by the developer, the community were presented with a table stipulating the financial qualification criteria for persons wishing to qualify for housing in terms of the project.”

This stipulates that the minimum monthly instalment persons qualifying for housing would have to pay is R4 394. Hence the requirement that the person(s) have a combined or single monthly income of at least R13 312. The community said until the second half of 2018, the proportion of subsidy on the units was 35% of the total. They claim the subsidy has been reduced to 21%, causing the increment in pricing.

The mayor refuses to engage the community but said in a letter: “The delayed implementation of the project from 2009 to 2016 significantly impacted the house prices ranges all over the country.

“The municipality acted in the interest of the community to push the prices down as far as possible. The average price of similar houses elsewhere in Stellenbosch is much higher.” Derrick Hendrickse, councillor for the EFF, who has been following up the matter for a couple of years, said the council is not being transparent.

“This housing project in Idas Valley was meant to be affordable. The municipality is subsidising it heavily.

What I want to know is: What is the actual cost that ASLA is charging to build the houses?”

Hendrickse said: “We want a breakdown of the costs and ASLA and the municipality is not giving that to us.

“When the project began, it was meant to provide a combination of 100% subsidised (free) housing, lower GAP, middle GAP, higher GAP and entry level, affordable housing. “The municipality subsidised the land costs, development costs and cost of service installation significantly and this brought the final price to about R175000 per unit.”

Van Deventer said in her letter to the community: “As this is the first mixed-used development in Idas Valley, the issues raised by the community were taken into regard. The municipality agreed with the developer to have a variety of unit type sizes and costs in both phases of the project, and that the majority of the units planned would be less than R521 000 per unit.”


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Cape Argus

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