SA Affordable Housing chatted with Gail Day, Executive Manager of the Free Market Foundation (FMF) on their Khaya Lam initiative.
Khaya Lam means ‘My Home’. The initiative was launched in 2010 and is based on the premise that property rights are a prerequisite for growth, and that ownership brings about pride and dignity.
But let us hand over to Gail:
“The start of Khaya Lam was not without its problems. We had to iron out issues like working out how to establish and develop relationships with a municipality, what to do about electrical compliance certificates, how to bring conveyancers on board at a price that was affordable to sponsors. Critical also was understanding transfers, the process with the Deeds Office and a whole lot more.
Our first transfers were painful. However, the timing turned out to be interesting in the sense that we handed out the first 100 Khaya Lam title deeds in 2013, exactly 100 years after the Native Land Act deprived black South Africans of the right to own property.
Khaya Lam deals almost exclusively with old apartheid rental stock, in other words with properties owned by municipalities and rented to tenants. Our goal is to transfer ownership from the municipality to the legal tenant as shown on the municipal records. The secondary goal is to achieve this without any cost to the municipality or the tenant. Obviously, there are costs: conveyancers, a Deeds Office fee, staff, and admin. The Khaya Lam project is funded through the generosity of private sponsors.
One of our biggest achievements was bringing conveyancers on board at a vastly discounted rate. As we know, a conveyancer must attend to the application personally, spending much time at the Deeds Office, probably back and forth. An ostensible reason for their generosity is handling transfers in bulk, but all, without doubt, bought into the cause of people owning property and the value added to the country in the long term.
A critical factor is signing an MOU with a municipality. Our first municipality was Ngwathe Council (Parys, Free State). We had a friend in Parys who was well connected and consequently we were able to start with our first 100 houses in Tumahole. Since then, we have opened more in the area and grown especially in the Western Cape and Eastern Cape to provide homes for several thousand.
Our handover events are apolitical. No political party t-shirts or banners are allowed, but certainly the municipality can display a banner as this shows how the municipality is working for their voters.
Another big challenge is getting applications and supporting documentation from tenants to proceed with the transfers. The process is complicated by deaths, divorces, sub-letting and so on. We try to assist but there are limits to what we can do in these cases; usually only the council can assist in ensuring we are dealing with the legal tenant.”
It is no secret that the process from application to receiving the final title deed is lengthy, arduous, and filled with potholes all the way. The bureaucracy around the process is well documented by many of those companies and organisations that deal with this process daily.
So, Gail, tell us about the sponsors because without them this initiative would never have got off the ground, right?
“Certainly, it is important that our sponsors buy into the programme and see that we have tried to keep costs to a minimum while enabling the various players in the process to make a living. Essentially, they buy into our over-riding principle that ownership brings dignity and grows the economy. New owners take pride in their homes, make additions using local builders and materials, obtain rent from tenants, open businesses and so on. Khaya Lam turns dead capital into dynamic capital.
So, the sponsors see the value we are offering as well as the essential value of turning tenants into homeowners. Since 2013, we have completed around 7500 transfers and for this year we budgeted for 250 transfers per month bringing that total to 10 000 by the end of February 2023.
Our sponsors donate amounts ranging from sufficient for one title deed to thousands of deeds.
We have over 50 projects on the go now so it is all very exciting,” concluded Gail.
The Free Market Foundation is an independent public benefit organisation founded in 1975 to promote and foster an open society, the rule of law, personal liberty, and economic and press freedom as fundamental components of its advocacy of human rights and democracy based on classical liberal principles. It is financed by membership subscriptions, donations, and sponsorships.
SA Affordable Housing also brought in Alexandra Township, north of Johannesburg, and while there is work being done there by the Foundation, it is a story on its own so we will keep that for the next issue.