FREQUENTLY ASKED QUESTIONS
Q. What is the difference between RDP and Government Subsidise housing?
Reconstruction & Development Programme (RDP) is a South African socio-economic policy implemented by the government of President Nelson Mandela in 1994.
The programme oversaw many major advances in dealing with South Africa’s most severe social problems:
Subsidised housing- is a programme that affords the beneficiary to acquire a house that is built and provided by the government through a government subsidy. These houses were commonly referred to as ‘RDP Houses’
Financed Linked Individual Subsidy Program, better known as FLISP, was developed by the Department of Human Settlements to enable sustainable and affordable first-time home-ownership opportunities to South African citizens and legal permanent residents earning between R3501 and R22 000 per month (the “affordable” or “gap” market). Individuals in these salary bands generally find it hard to qualify for housing finance. Their income is regarded as low for mortgage finance, but too high to qualify for the government “free-basic-house” subsidy scheme.
Q. What to do with FLISP?
Qualifying applicants may use FLISP to do one of the following:
• Buy an existing, new or old, residential property.
• Buy a vacant serviced residential stand linked to NHBRC registered home builder contract or build a residential property on a self-owned service residential stand, through an NHBRC registered homebuilder.
The once-off FLISP subsidy amount ranges between R10 000 and R87 000, depending on the applicant’s monthly income. The maximum price of a property that can be financed through FLISP is R300 000.
FLISP Applicants must meet the following qualifying criteria:
• RSA citizens with a valid ID or permanent residents with valid permit
• Over 18 years and competent to legal contract.
• Never have been benefitted from Government Housing Scheme before.
• Have an approval in principle of home loan from accredited South African banks.
• First time home buyer, earning from R3501 to R22 000 per month.
• FLISP is for residential properties in formal towns where transfer of ownership and registration of mortgage bond is recordable in the Deeds Office.
• RSA Bar coded ID or Bar-Coded permanent residence permit.
• Birth certificates/RSA IDs of all financial dependents (where applicable).
• Proof of foster children guardianship (where applicable).
• Marriage certificates, civil union certificate or cohabiting affidavit (where applicable).
• Divorce settlement (where applicable).
• Proof of monthly income.
• Home loan approval in principle/ Grant letter from an accredited Lender.
• Agreement of sale for the residential property.
• Building Contract and approved Building Plan (where applicable).
