Guiding consumers since 2009

Apply now for a FLISP housing subsidy

By Danielle van Wyk

Being a first time home-buyer in today’s economic climate can prove quite the expensive endeavour, as expenses rise and your salary doesn’t always follow suit. This has become increasingly difficult for those who fall within the lower income spectrum. For these owners, however, relief is offered in the form of the Finance Linked Individual Subsidy Programme (FLISP), a government initiative to help first-time buyers.

What is FLISP? 

“The objective of the programme is to reduce the initial mortgage loan amount to render the monthly loan repayment instalments affordable over the loan payment term,” stated the Western Cape Department of Human Settlements (DHS).

Who qualifies? 
Households whose income range is R3 501 to R15 000 and are South African citizens, are qualifiers for this subsidy. The amount, however, that they qualify for is income dependant.
 
“Depending on their income level, a qualifying beneficiary will qualify for a subsidy of between R20 000 to R87 000,” stated the DHS.
 
In addition, the beneficiaries need to be first time government subsidy qualifiers and not have previously owned a fixed residential property. They also need to fall in the bracket of either being married or cohabitating or single with financial dependants, explained the DHS.
 
Benefits 
 
FLISP assists qualifying beneficiaries who are wanting to apply for mortgage finance to:
 
- Be in ownership of an existing property
 
- “Obtain vacant serviced residential stands which are linked to house-building contracts with home builders registered with the National Home Builders Registration Council (NHBRC) or,
 
- “Build a new house with the assistance of a homebuilder registered with the National Home Builders Registration Council (NHBRC), on a serviced residential stand that is already owned by the beneficiary,” stipulated the DHS.
 
The acquisition of a FLISP subsidy also assists in the affordability study performed by lenders on all prospective home owners, stated Rachel Vickers, broker/owner of RE/MAX Kairos.
 
Challenges
For the most part, property developers are keen on engaging FLISP subsidies. However, some remain hesitant to take on FLISP as a result of challenges in getting money paid out.
“An additional challenge lies in that the joint household income must be less than R15 000. The individuals in Gauteng, the most interminable market, exceed this criteria. On my latest development only two candidates out of 40 earned in this limit. It would grow much traction if this warning bracket was increased to R18 000,” said Vickers.  
 
Application
 
Prospective applicants need to be in the market for buying a house and be of a financial standing that enables them to ‘secure a home loan as it is a requirement to access the Finance Linked Individual Subsidy Programme (FLISP) subsidy,’ added the DHS.
 
Applications are to be made directly to your provincial Department of Humans Settlements, and according to the DHS is subject to the province’s budgetary allowance.
 
The Western Cape Government, reportedly,  have called on all potential applicants to apply before the end of March.
 
For more information on the Western Cape programme and the application process, visit the Department of Human Settlements website.

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