- FLISP is a government program that subsidises homebuyers with low income.
- The 100% home loan removes the obstacle of having to pay a deposit.
- The low interest rate in South Africa makes it the ideal time to pursue home ownership.
If you’re buying a house for the first time, you may find the process intimidating. The need to muster funds for the deposit; the tense wait for home loan approval. However, first-time homebuyers will be happy to know that the South African government, along with various home loan providers, have introduced a number of policies that support first-time homebuyers.
These policies will play an essential role in revitalising the housing market following the impact of Covid.
How the South African government helps first-time homebuyers
Government subsidies make homeownership a reality for low-income earners. One example is FLISP.
FLISP (Finance Linked Individual Subsidy Program) is a government subsidy, designed to help medium to low-income earners. It originally only provided for those who earned less than R15,000 a month, but since July 2018 that number has been raised to R22,000. In this tumultuous economic era, this is a significant boon for first-time homebuyers.
The subsidy is paid into your account, reducing your monthly home loan installments. In order to qualify you:
- Need a household income that falls between R3,501 and R22,000 per month.
- Must be a South African citizen over the age of 18.
- Must be either married, cohabiting, or single with at least one dependent.
- Must not have benefitted from a previous government housing programme or subsidy.
- Must have already had a home loan approved by the bank.
The size of the subsidy depends on your income; the lower your income, the higher the subsidy. You can apply for a FLISP subsidy at your local Department of Human Settlement office, or by contacting the National Housing Finance Corporation.
100% home loan
Another boon for first-time homebuyers is the 100% home loan, which removes the need for a deposit. With interest rates in South Africa at their lowest point in decades, a home loan that requires only monthly installments can save money in the long-term due to favourable interest rates.
Of course, your chances of qualifying for the 100% home loan depends on having a good credit score.
Taking the first step
Though you may have considered homeownership an unaffordable dream until now, hopefully the support for first-time homebuyers has encouraged you to finally take a step towards homeownership. If that is the case, bear in mind that ooba Home Loans offers a range of tools that can make the home buying process easier. Start with their Bond Calculator, then use the ooba Home Loans Bond Indicator to determine what you can afford. Finally, when you’re ready, you can apply for a home loan.
Can't find what you are looking for?
Ranked #1 in Financial Services on Hellopeter
Average rating of 4.82 from over 3 000 reviews
Simply The Best
Ooba home loans services are simply the best. My Consultant Bianca Dancer was so hands on and helpful from the get go. She guided me through the entire process and put me at ease being a first time buyer. I highly recommend their services.
Jay Govender and Maleshini Reddy from OOBA provided outstanding assistance and guidance in securing our home loan. Response times were excellent and they were professional and friendly.
Estelle Vorster was really helpful in securing the best deal for my home loan, she not only negotiated a lower interest rate she went as far as securing 50% discount on the transfer costs.