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NURCHA’s Ideals and
It’s all about ideals…government’s development
finance institution, the National Urban Reconstruction
and Housing Agency (NURCHA), celebrates its 20 year
milestone as the leading Construction Finance and
Programme Management institution in South Africa.
Since 1995, NURCHA has provided R3,8 billion developer
funding to roll out 392 145 housing opportunities across
the sector with project values of more than R20 billion.
Viwe Gqwetha
2
I
n boxing terms NURCHA is en-
dowed with courage and an at-
titude that is willing to take on all
comers as it punches above its weight
considering its small balance sheet
and marginal income.
NURCHA has successfully cornered
almost 10% of the Affordable Hous-
ing market, making it a tour de force
in housing delivery. After market
lulls of previous years and a new
forward-thinking strategy, govern-
ment’s funding arm for developers
and emerging contractors has led
the institution on an exceptional
growth path. As the housing market
recovers from the global crisis, it
is time to reflect on what NURCHA
has achieved and to recognise what
it brings to the human settlements
sector through all of its programmes
and new product offerings.
NURCHA Managing Director, Viwe
Gqwetha, shares some of the sig-
nificant milestones in their rainbow
history - the African Bank defaults;
the Savings Schemes for communi-
ties and associations; Presidential
projects; newways to operate; a new
breed of funding partners; and the
RDP/BNG fully subsidised housing
policy.
DEMOCRACY &
HOUSING
Established at the start of South Afri-
ca’s newdemocracy, NURCHAwas set
up by the country’s iconic statesman,
President Nelson Mandela and other
notable leaders such as Frederik Van
Zyl Slabbert, international philan-
thropist billionaire George Soros and
the South African government. With
the backing of the President and Jay
Naidoo, the Reconstruction and De-
velopment Programme (RDP) office
and stakeholders, NURCHAwas given
the task to normalise the market and
provide finance to contractors to de-
liver housing for the poor.
According to Gqwetha, Van Zyl
Slabbert should be credited for
bringing Soros on board to part-
ner with NURCHA and the South
African government to fund the
development programme. Other
notable stakeholders and support-
ers include NURCHA board member
Khehla Shubane, who with Cedric de
Beer, Jill Strelitz and Nhlanhla Mjoli
has guided, shaped and supported
NURCHA from the start.
Viwe explains: “At that time in our
history there were structures such as
Housing Forums, policy institutions
including the Urban Foundation,
and Independent Development
Trust, who were involved in funding
housing solutions etc. NURCHA was
meant to have a five-year lifespan
to bankroll contractors to provide
housing for the poor, as well as fund
micro lenders in a bid to upgrade
low-income housing and provide
infrastructure and services such as
schools and clinics.”
A NEW STRUCTURE
From 1995 to 1999, NURCHA offered
commercial banks guarantees that if
a contractor defaulted on a bank loan
it would pick up the tab. But, accord-
ing to Viwe, offering these guarantees
to encourage the commercial bank-
ing fraternity to come on board with
development finance failed.
NURCHA provided guarantees to
micro funders, including Ithala Bank,
to fund small loans to householders
for upgrades, water tanks and so on.
On the supply side, NURCHA financed
contractors and 16 000 houses were
delivered by 1999 and grew to 88 000
in 2003. NURCHA continued to pro-
vide innovative products but some
risks emerged at this early stage.
Contractors experienced payment
delays; some of the former Housing
Boards had administrative problems
and, also interest rates spiked to 25%,
borrowers felt the pinch.