Transforming lives: 6,000 low to middle-income families access affordable home loans

Close to 6 000 families earning less than R34 000 were put into homes over the past 12 months.

This was as a South African bank, First National Bank (FNB) approved R3.3 billion in affordable housing home loans over the past year. 

“In a country facing serious socio-economic challenges, and a shortage of affordable housing, it’s humbling to know that our innovative solutions are helping thousands of families find dignity, pride and shelter,” says Lytania Johnson, CEO of FNB Personal Segment.

“Owning a home is the foundation of better living standards and financial security. It creates generational wealth and remains the single biggest investment many families will make.

"Even with the rising cost of living, we know that our customers are determined to achieve lifelong goals such as home-ownership, a milestone that helps build a lasting family legacy.”

The financial institution says it continues to improve access to affordable housing for low- to middle-income South Africans, amid rising property prices and economic challenges. 

Moreover, the bank says it supported customers with an integrated Financial Linked Individual Subsidy Programme (FLISP) process, helping customers with R72m in government subsidies. These were advances made to customers earning between R3 501 and R22 000 per month, by advancing nearly R900 million in home loans between July last year and June this year, helping more South Africans achieve home ownership.

FNB says its affordable housing portfolio now stands at R23.2 billion as of June this year, reflecting its dedication to supporting households earning up to R34 400 household income per month.

Through innovative solutions and strategic partnerships, the bank says it is addressing the housing gap and enabling more South Africans to achieve homeownership. Over the past decade (2015–2025), FNB says it has paid out a total of R33 billion in affordable housing loans, helping approximately 117 000 households achieve homeownership.

Johnson says as a financial services provider, they respond to the evolving needs of their customers who earn below R750k per annum, as they recognise their responsibility to support them along their journeys.

“We are focused on purpose-led lending and meaningful value-adds like essential rewards with fuel and groceries, to alleviate the burden of rising household costs,” she adds.

FNB interventions

Helping customers with an integrated FLISP process, supporting R72 million in government subsidies over the last year. FNB is the leading bank in FLISP funding allocations.

Integration of government subsidies, such as First Home Finance (commonly known as FLISP), to reduce upfront costs and improve affordability and Collective Buying Home Loan: FNB’s pioneering product allowing up to 12 individuals to co-purchase a property and share repayments.  

“The foundation of getting more people into homes remains inclusive and drives higher economic growth,” adds Chris Labuschagne, CEO of FNB Home and Secured Lending.

“We are committed to creating accessible pathways to homeownership and helping South Africans build generational wealth through property.”

According to FNB’s data,  most of its customers who earn less than R22 000k per month meet the criteria to be considered for First Home Finance (FLISP).

“That’s why our processes integrate support to help these customers access government subsidies such as FLISP. Our Collective Buying solution has also been crucial in helping to level the playing field for this group and improve their affordability.

"We are also assisting more customers with integrated advice to help them unlock cash flow in transactional banking, credit, insurance, investment and leveraging our rewards,” he adds.

FNB says its affordable housing strategy is a cornerstone of its financial inclusion agenda, ensuring that more South Africans have access to safe, secure, and sustainable housing solutions, regardless of their income levels.

Impact of urbanisation on property

Urbanisation is expected to continue driving housing demand and contribute to price inflation in the market. To help address these challenges, FNB says it deliberately collaborates with property developers, city councils and fintechs to create sustainable housing solutions that will improve affordability and accessibility.

The financier says the local affordable housing market faces significant challenges that require close collaboration between the public and private sectors to address supply and reduce transactional costs.

It says the foundation of getting more people into homes remains inclusive and a driver of higher economic growth.

“Our contribution to affordable housing reflects our promise to help our customers become homeowners. By making homeownership a reality for more South Africans, we are empowering communities, fostering economic growth, and promoting social stability,” Labuschagne says.

Impact of apartheid on SA geography

Participating in the Local Government debate that took place at the National Council of Provinces (NCOP) chamber under the theme “Restoring the dignity of our people through spatial" on Wednesday, Deputy Minister of Human Settlements Tandi Mahambehlala said apartheid may have been defeated in law, yet its geography remains imprinted on the country’s cities, villages and rural towns.

She said it haunts the daily lives of millions who live far from opportunities, separated from our country's economic hubs. “Our task is to replace that geography of exclusion with a geography of inclusion and hope.

“This mission is a constitutional obligation. Section 26 of our Constitution demands that the state progressively realise the right of access to housing and prevent unlawful evictions without due process.

"The Housing Act, the Spatial Planning and Land Use Management Act, the National Development Plan and the National Spatial Development Framework all guide us toward sustainable human settlements that are spatially just, integrated, and inclusive.”

Housing transformation

Mahambehlala said the Draft White Paper for Human Settlements builds on these imperatives as the country moves towards the transformation envisioned for 2050. The deputy minister said the department continues to work as both architect and advocate for this transformation.

“Through Breaking New Ground, we promote well-located and mixed-use communities that erase the artificial distance between where people live and where opportunities exist. 

She said that since 2023, 2 400 hectares of well-located land have been released for human settlement development.

“Seventy thousand title deeds have been issued, restoring ownership, dignity, and long-term economic stability to families across the country. We are finalising a modernised housing subsidy system with SITA, to ensure that allocations are transparent and that no family is denied fairness due to inefficiencies.” 

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