08 Apr Government Subsidy Housing: A Guide for First-Timers
For many, a government subsidy is the key to unlocking home ownership — a dream many hold but can’t grasp because of the housing market’s exorbitant prices. With some one-bedroom houses offered at a million Rand or more, it’s no wonder so many have given up on their dreams of having a home they can call theirs.
To address this problem, the government created a subsidy program initially called FLISP (Finance Linked Individual Subsidy Program), which aims to bridge the gap between low earners – people who earn less than R3,000 per month and qualify for free housing – and the lower middle to middle class – people who earn more than R3,500 per month, but less than R22,000 per month. Typically, people in the lower middle to middle class income bracket (called the gap market) don’t qualify for mortgages, making it almost impossible to be eligible for traditional finance.
Government-subsidised housing is the key to unlocking property ownership. Your name will be on the deed, and you’ll be able to modify it however you’d like.
How do you apply for this wonderful opportunity? Is there anyone who can help?
This post is a guide to the government-subsidised housing (FHF) application process: what to expect, how to qualify, and what documents you may need to submit.
Let’s dive in!
How to Apply for Government Subsidy Housing
Before we discuss how to apply for FHF (First Home Finance), you should know whether you’re eligible for the subsidy. To qualify, you must:
- Have never owned a home or property before. This must be your first residential property purchase
- Have a dependent or spouse (your spouse must also have not owned residential property before)
- Earn between R3,500 and R22,000
- Be a South African citizen or have a permanent residency permit
- Be over 18 years old and competent to contract
- Have not received a government subsidy before
You will have to submit documents that support this, such as marriage certificates, birth certificates, permanent residency permits, etc.
After you know you’re eligible for FHF, you must complete an application form. The application form can be nuanced, so we advise you to seek the assistance of a professional. If the form is incomplete or you don’t include all required documents, your application will be rejected and discarded.
Documents Required
In general, these are the documents you can expect to file with your completed application:
- Certified copies of identity documents
- Certified copies of dependents’ birth certificates
- Certified copy of marriage certificate/final order of divorce
- Original recent payslip/proof of social grant
- Certified copy of the deed of sale/offer to purchase, if applicable
- Certified copy of the bond approval/bond quotation, if applicable
- Original or certified copy of the transfer cost statement from the transferring attorney and bond cost statement from the bond attorney, if required.
You can access the subsidy with an approved home/mortgage loan, an interest-free loan (from a family member or Stokvel, for instance), a pension-backed loan, a rent-to-buy program, or your own savings.
After you’ve submitted your documents and the application form, you’ll receive a verdict. If your application is approved, the subsidy will be transferred to your bank account. Then, you’ll have to pay your attorney or conveyancer, your loan/mortgage deposit (if applicable), and any other costs.
Who Can Help You Apply for FHF/FLISP?
FirstStep Housing are experts in the FLISP application process, the legalities and caveats of government housing subsidies, and how the deed transfer and bond origination processes work with a lower income. Let us help you achieve your dreams of home ownership – apply today.