PART 2: THE ROLE OF THE PRIVATE SECTOR IN AFFORDABLE HOUSING

Caption: Lloyd Wallace, Technical Director and Expertise Lead, Infrastructure Advisory, Zutari.

By Lloyd Wallace, Technical Director and Expertise Lead, Infrastructure Advisory, Zutari; and Suzette van der Walt, Consulting Manager, Infrastructure Advisory, Zutari. This is Part 2 of a two-part article.

…continued from Part 1.

Affordable housing remains a complex challenge, with varying interpretations of what ‘affordable’ actually means. According to the World Bank, housing is considered affordable when it costs below 30% of the average household income.

The private sector, equipped with its efficiency and innovation, can play a transformative role in reshaping the landscape of affordable housing. Collaboration between public and private entities is essential to navigate the intricate challenges the housing backlog poses and create resilient infrastructure for future generations.

As we strive for economic redress and equitable access to housing, it is crucial to leverage the strengths of the private sector while mitigating the risks associated with subsidy-based models. By doing so, we can pave the way for sustainable, affordable housing solutions that address both the immediate backlog and future challenges. The success of subsidised housing lies not only in its provision but in its ability to endure and adapt to the evolving needs of our communities.

Zutari’s Infrastructure Advisory Team attended two housing conferences in November 2023. The 8^th Annual Affordable Housing Africa conference held in Cape Town saw specifically DFIs and private developers in good attendance. The session also concluded with a masterclass on PPPs in affordable housing. Zutari presented two case studies, contrasting insights from the teams working with the City of Cape Town’s Public Housing Department and insights from providing lenders with technical advisory services for social housing developments.

The 39^th annual African Union for Housing Conference saw housing practitioners from Africa come together to discuss the theme ‘Affordable Housing on the Front Lines: Cases from the Continent’, which shone the spotlight on affordable housing finance. Policymakers, government officials, bankers, fintech and developers were in attendance. Zutari highlighted its research around the realities of private sector involvement in State-provided rental housing, using the City of Cape Town’s Public Housing Department as a case study.