Khayelitsha property owners and others can boost rental market

2020-09-07T19:23:17+00:00September 3rd, 2020|News|

The City of Cape Town’s Mayoral Committee earlier this month, 1 September 2020, approved recommendations that will enable property owners in less formal areas across Cape Town to develop small scale rental accommodation that is affordable and complies with the National Building Regulations.

Khayelitsha, South Africa’s third-largest township. Image credit: Pinterest

Khayelitsha, South Africa’s third-largest township. Image credit: Pinterest

Cape Town is facing a huge demand for affordable rental accommodation.

The City recently conducted an in-depth analysis of the small-scale rental market in Khayelitsha. This study found the market is thriving, despite any assistance from government. This market is driven by private individuals who develop rental opportunities on their land, either by extending their homes, or by adding separate rooms or structures. These additions are formal or informal.

The report that served before the Mayoral Committee concluded that the City should consider incentives for private property owners in incremental housing zones to assist with the provision of affordable rental accommodation.

Given the Mayoral Committee’s support, the recommendations to stimulate this trend, and to make it easier for individuals in incremental housing zones to pursue this form of development, will now serve before Council for approval.

The following recommendations will serve before Council, among others:

  • to amend the zoning scheme in areas where the City would like to encourage this form of development, either by creating an overlay zone, or by adding small scale rental units as an additional use within areas zoned as Single Residential 2: Incremental Housing
  • that the City creates a menu of proto-typical building plans for small scale rental units from which the landowner can choose and submit to the City for approval in terms of the National Building Regulations
  • to prioritise the assessment of building plans in these areas, and to wave fees subject to the property’s rates and service payments to the City being up to date
  • to increase the service infrastructure capacity in these areas
  • to establish a list of accredited small-scale local building contractors
  • to host workshops in targeted areas to create awareness and to inform property owners of the benefits of small-scale rental units

As stated above, the recommendations are based on a recent study that confirms that many property owners in Khayelitsha are creating additional housing opportunities on their erven. This trend was identified through an analysis of properties in Khaya, Eyethu, Ekuphumuleni, Graceland, and portions of Ilitha Park and Mandela Park – a study that covered about 22% of the Khayelitsha area.

According to the analysis:

  • 7 425 additional housing opportunities have been provided on 5 294 properties out of a total of 9 007 properties.
  • Of the 7 425 opportunities, nearly 40% are formal additional housing structures

Thus, nearly half of these small-scale rental units are formally constructed. Thanks to the support of the local district planning office in Khayelitsha, there is also an increase in the number of formal rental units that comply with the National Building Regulations; and a drive to replace existing wood and iron structures with formal units.

‘The question now begs: what role can the City play to encourage this trend? We know there is a huge demand for affordable rental accommodation, and we see that many property owners in Khayelitsha are pursuing this as an income generator. There is also an opportunity here for the City to empower small scale entrepreneurs across the city to use their properties to generate an income.

‘By investing in their properties, the small-scale rental landlords can become owners of on-site long-term capital assets that will grow in value over time. Furthermore, in this manner, we can also address the structural safety of new rental accommodation by encouraging that units comply with the National Building Regulations and are built in accordance with an approved building plan,’ said the City’s Mayoral Committee Member for Spatial Planning and Environment, Alderman Marian Nieuwoudt.

To incentivise this trend, it is recommended that the City consider amending the development rules applicable to Single Residential 2: Incremental Housing in the Development Management Scheme in the City’s Municipal Planning By-law.

It is also recommended that the City makes it easy for property owners to provide formal rental accommodation that complies with the National Building Regulations, as opposed to the provision of informal structures. Thus, it is proposed that the City makes available ‘off the shelf’ building plans which the owner can submit to the City for approval, together with a site plan.

The City will commence with the above should Council approve the recommendations.