The state subsidises social housing in order to ensure provision of rental housing of exceptional quality, at affordable rentals in well located areas. This is done through capital grant funding called the Consolidated Capital Grant (CCG).
The average cost of construction is R426 000 per unit (including land and bulk services) and the current quantum that the SHRA administers is R328 867 per unit. The grant applicant must provide the remainder of the cost through loan funding and provision of equity of which ODAs are required to provide 20% of equity.
The ideal social housing project is one that aims to restructure cities by providing low to medium income households with housing opportunities in well serviced areas of high economic activity. Investment in social housing projects is also targeted in urban areas that require revitalisation. It is hoped that this state investment will act as a catalyst for private sector investment therefore the overall aim of the social housing programme is one of restructuring and not just housing delivery.
The SHRA will only consider project applications that adhere to the investment criteria and are located in certain urban areas named restructuring zones. These are geographic areas identified by local authorities  and  supported  by  provincial  government  for  targeted, focused investment. As per the Regulations, Chapter 5, a summary of the investment criteria is as follows:
Land and services: the SHI must have land rights, adhere to zoning, ensure there are bulk services.
Housing design criteria: medium to high density, bachelor to 3 bedroom units, high quality spec.
Marketing: ensure proper marketing of units, applicant training programmes and equitable selection process.
End User Agreement: lease required.
Rentals / levies as stipulated.
Financial viability needs to be demonstrated.
Governance and management to be demonstrated.
Building and property maintenance to be undertaken.
To apply for capital grant funding, the first step is to contact the municipal and provincial official for social housing in the respective area. It is a requirement that these officials endorse your project. Thereafter, you must register the project on the social housing pipeline for assessment and accreditation as grants are warded to accredited projects. This can be done by sending an email to projects@shra.org.za and the project accreditation pack will be emailed to you.
CAPITAL INVESTMENT
The SHRA may invest in social housing projects in accordance with the investment criteria set out in the Social Housing Regulations.
Capital investment is made through the Consolidated Capital Grants (CCG) and debt Funding. There are instances where delivery agents are able to contribute their own equity, or may secure donor funds.
CONSOLIDATED CAPITAL GRANT (CCG)
The CCG is a significant contribution to the capital cost of a social housing project, contributing to the delivery of viable, feasible, and sustainable projects that provide affordable rental housing to the poor.
DELIVERY AGENTS
SHRA delivers social housing units through delivery partners. These can either be in the form of social housing institution (SHIs), which are non-profit companies or other delivery agents (ODAs) which are for-profit companies. SHIs must be conditionally or fully accredited by the SHRA.
Delivery partners comprise of the following:
Existing or new SHIs;
Non-profit private sector companies;
For profit private sector companies/ other deliver agents (ODAs).
Delivery agents shall exclude provincial government or municipalities.
full info here https://shra.org.za/
