The South African Civil Society Information Service

Houses for All: A Concept in Crisis

By Glenn Ashton · 26 Nov 2010

Owning property in the form of a home is the basis for family and community stability. Homes are usually an individual’s single most valuable economic asset and ownership is a traditional entry point into the formal economy. Homeowners are also able to leverage social security by accessing formal, stable community structures.

A primary demand of the Freedom Charter was for “houses, security and comfort.” This call was realised through the government’s commitment to build a million houses within five years after taking the reins of power in 1994.

While it took seven years to reach the magic million numbers, government has since doubled that with over two million houses built to date. These are mainly so-called RDP ‘starter’ houses, named after the prematurely abandoned Reconstruction and Development Project, the initial government programme to initiate socially inclusive growth during the early years of the democratic transition.

Sixteen years later, we must enquire whether this massive investment of over R70 billion of state money has borne fruit and benefited the intended recipients? Have the intended social and economic benefits materialised?

The initial rush to build houses saw very poor centralised record keeping of who the beneficiaries of the first houses were. The system was open to abuse and corruption and advantages were taken of these gaps. Many beneficiaries sold their houses outright. Up to 90% of RDP houses in some areas are evidently occupied by other than the intended, original tenants.

The primary beneficiaries of the rushed early years of the RDP process were large construction companies who seized opportunities in providing the industrial scale manufacture of sprawling matchbox housing estates of dubious build quality. Significant funds are now being diverted to repair or rebuild poorly built houses.

While many have indeed benefited from these housing initiatives, have the intended consequences manifested? Have new homeowners extended their homes as was intended when built? Have first time property owners been able to leverage their property to enter into the formal economy in any way? Have stable communities resulted or are community relationships still based on similar dynamics as those that existed in informal settlements? 

A cursory examination shows that while some benefits have accrued, real problems remain.

Very little broad research has been undertaken that examines these questions in sufficient depth. There is extremely poor research on beneficiaries and the impacts on their lives. Some has been undertaken by the National Department of Human Settlements and the City of Cape Town has begun other research due for completion early next year. 

Earlier surveys by the City of Cape Town to ascertain who was living in the RDP houses in places like Du Noon to the north of the city failed because researchers were intimidated and could not complete their surveys. Preliminary findings indicated that many of the houses were occupied by others than the intended recipients, contrary to stipulated policy. 

State subsidised starter homes were not meant to be sold within eight years -- soon to be reduced to five. If houses are not occupied by intended beneficiaries the state is entitled to repossess it for the next person on the waiting list. This happens rarely, if at all.

A primary shortcoming of the chaotic early years of the RDP housing process was the failure to grant and deliver clear title to the intended recipients. Even when titles were granted, subsequent transfers invalidated many. Record-keeping remains extremely poor. Many houses around the country have apparently been transferred for ridiculously low prices, driven by the circumstances and requirements of sellers.

Many circumstances trigger the sale of houses. These range from indebtedness, possibly the most common cause of loss, to immediate family needs such as funerals. The social pressures of extended families often weigh heavily on those perceived as having a strong economic base such as a house. 

Funerals place particular demands on families and the high costs are a common reason for the disposal of RDP houses, often for far below market value. Funeral incurred debt is a significant and recurrent social demand.

Indebtedness itself is often a far more sinister reason for the loss or alienation of a house. This fact has been a major reason that some research into RDP projects has been curtailed. Beneficiaries are illegally expelled from their homes for failing to service debt accrued from loan sharks. Lenders then either move in themselves or sell houses to third parties. Investigators are threatened and intimidated.

Homes are also alienated through beneficiaries renting them out after moving into backyard shacks or other informal housing. Even some of the high-standard homes built by NGOs such as the Niall Mellon trust and Habitat for Humanity have seen beneficiaries build lean-to shacks alongside the completed houses to rent out, or to live in so they can rent the house. 

This clearly short-circuits the dominant liberal vision of housing providing a dignified step up towards middle class aspirations. While this is not a universal problem, it does remain a factor.

The foundations of liberal economic policies are premised upon individual property ownership. The failure of the system to enable the poor to shift from survival mode into the mainstream economy indicates a systemic failure of the dominant economic model to meaningfully assist this marginalised sector.

The fact that the state has invested billions of Rands into houses as part of its neo-liberal model is indicative of its failure. Beneficiaries with secure title deeds are often in the minority. Most of this massive investment into housing stock has shifted into a completely parallel economy with little real integration with the formal economy.

This may not be a bad thing. The formal economy and the neo-liberal model of economic development we have pursued has failed to benefit a significant sector of society, which remains marginalised from (and by) the mainstream economy due to unemployment, geographical and social isolation. A strong argument can be made that the apparent chaos within the state subsidised housing system is a natural consequence of this economic marginalisation.

The informal manner in which this housing stock is traded is arguably an extension to the informal economy which has enabled the poorest South Africans to survive. The acquisition and disposal of a house, gifted by a munificent state is arguably just a temporary phase in the battle of survival against uncompromising economic realities. To one mired in poverty, a house is certainly not the epitome of some high faluting economic concept of a foot up the ladder. It is far more likely to simply be the manifestation of an opportunity.

Many of those who have lost, sold, or been cheated out of their houses are alleged to have rejoined the lists for a new home, hoping to repeat a cycle of transient stability. More recent house recipients, whose details have been accurately captured, have less hope of following this route. 

There is no single ready solution to the apparent chaos around the centralised, state run housing programme but some lessons have been learned. 

Several studies have shown state owned rental housing to be a preferable long-term solution. However, rental units do not provide the benefits of direct ownership and its associated theoretical economic and social advantages. Yet this becomes moot in light of the poor build quality and short lifespan of most RDP starter homes, when compared to the lifespan and economically stable returns of state rental housing.

Sweat equity as a method of buy-in by both individuals and communities is another solution. Besides collective community building, skills which financially benefit new communities are supported. Funds which would otherwise have gone to outside contractors are retained locally. The Western Cape government apparently plans to follow this model in future housing provisions, in its attempt to stretch housing budgets.

The handing over of substandard houses to beneficiaries who have no stake in what is essentially an external, supply side driven model will inevitably have shortcomings. The economic benefits to individuals and communities have been constrained by the limited social and economic vision of this model.

The challenge now is to tweak the model so that it can deliver not just houses but communities, with the requisite facilities capable of delivering the dream of an Ubuntu society. Shops, clinics, crèches, schools, proximity to places of work and other social structures are just as important as houses. Successful housing programmes must shift away from prescription toward more inclusive models.

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