Cape Town Accelerates Inner City Social Housing Development

Cape Town is taking significant steps to address the affordable housing crisis in the city’s central areas. The City Council has approved the development of the New Market Street property in Woodstock, which will soon be transformed into a mixed-use space featuring 200 social housing units, along with over 300 gap and market units.

Ideal Location for Residents

The 10,300 square meter property is strategically located, providing easy access to various amenities in central Cape Town. The initial feasibility study estimated 165 social housing units, but revised analysis allowed for an increase to 200 units. The development will also feature retail space to cross-subsidize the social housing units.

Mayoral Priority Programme for Affordable Housing Land Release

Cape Town Mayor Geordin Hill-Lewis has expressed the city’s commitment to expedite land release for affordable housing. In just a year, the Mayoral Priority Programme for Affordable Housing Land Release has approved five inner city land parcels for development. These parcels will produce over 1,300 social housing units across various locations, including Newmarket Street, Salt River Market, Pickwick, Fruit and Veg, and Earl Street.

Mayor Hill-Lewis emphasized that the private sector delivery is the future of affordable housing, with the government acting as an enabler through subsidies, bulk services, and discounted land for feasible affordable housing projects. The City discounts land released to social housing institutions and private developers, allowing for mixed-use projects that are financially viable.

Successful Implementation

In early May, the Maitland Mews social housing development welcomed its first tenants. The development comprises 204 units. The National Minister of Human Settlements, provincial housing MECs, and MayCo members from other Metros attended the event.

The City of Cape Town distinguishes itself from other cities by offering rates discounts for social housing projects in perpetuity and providing free water to social housing units. Furthermore, the City Council recently introduced guidelines for discounting public land to maximize the number of affordable housing units on released land.

Guidelines for Discounting Land

The guidelines aim to accelerate land release for more affordable housing and provide market clarity on factors considered by the City in discounting land. The City’s priority when releasing land is to increase the number of affordable housing units available, not to maximize its gains.

Mayor Hill-Lewis expressed confidence in these guidelines, stating that they would legally and constitutionally guide the City’s decisions on land release. Alderman James Vos, the City’s Mayoral Committee Member for Economic Growth, highlighted factors that will be taken into account when discounting land for social housing release, including the market value of the land, the need for affordable housing in the area, the number of units the project can yield, and the project’s overall feasibility.

Building an Equitable Urban Environment

With these guidelines in place, Cape Town is well on its way to enabling the private sector to deliver more affordable housing units close to economic opportunities. The city’s commitment to addressing the affordable housing crisis reflects its dedication to creating an inclusive and equitable urban environment for all its residents.