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In 2002, the NHFCwas also appointed
the project manager of the Pilot
Project.
In the first three years of business,
the NHFC increased its presence in
the low and middle income sectors.
However, the biggest part of its port-
folio was over 119 000 unsecured
loans through Niche Market Lenders
(NML), a micro finance vehicle and
the Rural Housing Loan Fund (RHLF).
NML advanced a credit facility to re-
tail lending institutions that targeted
the affordable housing market. The
thrust of the NML fund shifted from a
home improvement focus to ensur-
ing that people without homes were
enabled to acquire houses, either by
purchasing an existing home or build-
ing a new one.
The corporation undertook the
mammoth task of researching hous-
ing finance to Unblocking Finance
for Affordable Housing in South
Africa (UNFAH) and expose issues
that could be verified, and create
an understanding of the nature and
scope of the problems that impeded
the housing finance process. The first
empirical national study findings
altered the way in which the NHFC
did business and three new product
streams emerged. NHFC’s Alterna-
tive Tenure Division provided project
finance to emerging and sustainable
social housing institutions, in order
to develop tenure options other than
immediate ownership.
The Home Ownership Division
funded intermediaries to facilitate
ownership of affordable housing in
the low andmedium income housing
markets. The Incremental Housing
Division funded niche lenders, who
assisted low and medium income
households to buy land, renovate
existing homes, or top-up their capi-
tal subsidy with credit. Recognising
the importance of accurate, reliable
data and information, the NHFC also
established a Policy and Research
Unit. In addition, the Rural Housing
Loan Fund and the Social Housing
Foundation left the NHFC stable to
operate independently.
Adapting to Market
Needs
Not immune to changes in the mar-
ketplace, in 2001 the NHFC restruc-
tured its business to achieve a num-
ber of objectives. The state-owned
entity aggressively stimulated the low
income primarymarket by increasing
risk appetite. This significantly influ-
enced retail intermediaries to create
a continuum of housing finance op-
tions tomeet the needs of low income
households and beneficiaries.
The corporation consolidated
funding, streamlined operations,
focused on delivery, facilitated a
single-entry point for clients, and en-
abled the creation and development
of specialist providers with end-to-
end housing finance options. These
solutions included: Home Ownership
– NHFC’s on and off Balance Sheet
funding; Incremental Housing - urban
renewal and housing infrastructure;
and Alternative Tenure – social, rental
housing and tenure options support-
ing urban renewal strategy and com-
munity integration.
Highlights
The NHFC deserves the credit for
pioneering and financing social
housing in South Africa. The state’s
leading development finance arm in
Human Settlements was called on to
be a market maker, whether in social
housing or inner city housing. Moraba
states: “Wewill always take the great-
er risk, where the private sector is risk
averse. It needs someone to test the
market, we go in first – that is why
government is an enabler. We crowd
in private sector, not crowd out.”
Partnering with Implats on the
Boitekong Project, a public private
partnership with mining giant Im-
plats, the NHFC provided end user
finance to 2 000 employees and
won the South African Housing
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