Wednesday, September 23, 2020

Government introduces installment purchase scheme to prop home ownership

Faced with incessant complaints over exorbitant housing rentals, coupled with sky-rocketing purchasing prices at the disposal of Botswana Housing Corporation, president Khama’s administration is destined to move goal posts, introducing a new installment purchase scheme and a single housing authority all geared to make housing more convenient to the locals.

Legislators and members of the public have for a long time called for the mandate of the BHC to be reviewed, saying that the corporation is no longer committed to its original mandate of providing affordable accommodation for Batswana, especially because of its escalating rental and purchase prices. BHC, on the other hand, has maintained that prices are subject to external influences like the cost and availability of building materials and qualified personnel. Local financial institutions were also slammed for their rigorous requirements, among them the demand for a down payment when one applies for a housing loan.

During his state of the nation address, Khama said that government is cognizant of the factors that impede home ownership among locals, chief among them being the failure to mobilize adequate funding. The president went on to announce that government has instituted a new installment purchase scheme to make home rental and purchase more affordable.

“Government has also found it necessary to establish a single authority upon which all public housing delivery initiatives will be coordinated. Consultations are at an advanced stage within government to transform BHC into such an authority. Once the authority is in place, there will be clarity on the roles of the major players, including the private sector, in policy formulation, planning and monitoring of housing delivery,” said the president.

Disturbed by the deteriorating and debilitating housing situation saddling heavily on the back of Batswana and, in particular, the low and middle income earners, Gaborone Central MP Dumelang Saleshando moved a motion in 2007 calling on the government to review the mandate of the institution and empower it to deliver affordable houses for the lower and middle income groups.
“Housing is a human right which cannot be overlooked. Low cost houses cost P200, 000 and only those who earn P11, 000 per month qualify for a bank loan to purchase them,” Saleshando argued at the time.

Although the motion was passed unanimously by parliament in 2007, to date nothing seems to matter as thousands continue to feel the pinch ÔÇôsleeping in one bed-roomed house with as many as five individuals while those monied wallow in BHC posh houses.
That notwithstanding, president Khama’s administration is committed to the provision of housing for all irrespective of their income levels and social status through national policy on housing.

“During NDP 9, a total of P193, 725,368 was disbursed for 9,530 beneficiaries in both rural and urban areas in an effort to ensure that citizens and employees live a dignified life with adequate shelter. Government has put in place various housing initiatives under the ministry of lands and housing. These initiatives target the low income and other special categories of beneficiaries deserving assistance,” president Khama argues.

Besides BHC houses, the Self Help Housing Agency programme continues to play a pivotal role in the establishment, providing financial access for home improvement to low income households as well as plots in the urban areas.

To compliment this initiative, the government introduced the turnkey development scheme for the beneficiaries to access completed houses. During 2008 the SHHA loan threshold was increased from P20, 000 to P45, 000 whilst the turnkey was set at P60, 000. The repayment was also increased from 15 years to 20 years without interest for those who do not default in loan repayment. Since April 2009, P15, 5 million was disbursed for 151 beneficiaries under the SHHA loan and a further P29, 3 million for turnkey projects.

Apart from these schemes, President Khama insists government has initiated additional schemes aimed at improving housing delivery for different target groups based on need.

“These include provision of high density and multi-residential houses for the youth as well as bachelor flats for the first time home owners and employees. Consequently, in all urban and major villages where development plans and layout are prepared, land is identified and zoned for high density residential use where these houses will be constructed.

“During NDP 9, BHC completed 3373 housing units against a target of 3400. During NDP 10 it is anticipated that BHC will complete 29,000 housing units as part of government’s effort to accelerate housing provision. During the current financial year construction of 1093 housing units is on-going,” he concluded.

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