3 minute read
Property: Own your own home
from Spotong Issue 34
by 3S Media
OWN YOUR OWN HOME!
Take advantage of the buyers’ market and use FLISP to purchase your first property
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Strange as it may seem, right now is an excellent time to buy your first property. A record low repo rate of 3,50%, the lowest since 1973, and record high home-loan approvals are combining to afford first-time buyers an advantageous opportunity for getting into the property market. Getting your foot in the property door is now a reality for many first-time buyers and with the help of FLISP, many are well on their way to owning their very own home.
What is FLISP?
The finance-linked individual subsidy programme, or FLISP, is a government-backed initiative to promote and secure first-time home ownership for lower income earners in South Africa. FLISP makes it possible for people like you to own the home you want. FLISP was introduced by the department of human settlements in 2012 and the income threshold for the programme was increased in July 2018. FLISP is like being given free money just so you can afford to buy your first home. You don’t need to pay back your FLISP subsidy at any time.
How FLISP works
FLISP provides lower and medium income earners with a substantial subsidy that can be used to purchase property. Subject to pre-approval of a home loan, FLISP subsidies can be applied for by any South African family whose household income falls between R3 501 and R22 000 per month. Previously, the maximum threshold was set at R15 000 per month, but FLISP is now a n option for many more citizens.
What can you use a FLISP subsidy for?
Applying for a bond to buy your first home can seem a terrifying prospect when you’re not a big money earner. The South African government, motivated by its desire to uplift and empower every citizen, created FLISP to enable lower and medium income earners towards claiming their stake in the property market. As a subsidy, FLISP can be used to put down a deposit on your first home or used to shorten your home loan repayment period or lower the monthly repayment amounts.
FLISP subsidy criteria
• If your family’s monthly income falls between R3 501 and R22 000 per month, you may apply for a
FLISP subsidy. There are other qualifying criteria, so keep these in mind when you want to apply for a FLISP subsidy: • You must be a South African citizen, over the age of 18, and you must be married, cohabiting, or be a single person with a dependent. FLISP aims to enable families to own their own homes. • Your bank or financial institution must have already approved you for a home loan. You can’t apply for a FLISP subsidy from the government until you have been approved for a home loan. • Of course, applying for a home loan means you’ll need to be credit checked, and agree to all the terms and conditions as set out by your financial institution. • Your household income will be analysed in your application for a FLISP subsidy. Your total household income must not exceed R22 000 per month. • You cannot have previously benefited from a housing subsidy or government housing programme. For example, if you live in an RDP house, you cannot receive a FLISP subsidy. • FLISP is a one-time payment subsidy. You cannot apply for a second FLISP subsidy when you want to purchase a second home.
Your FLISP subsidy amount
We used the FLISP website’s subsidy calculator to work out how much you can expect to receive from your FLISP subsidy. For example, if your household’s monthly income is between: • R3 501 and R3 700, you can apply for a FLISP subsidy of up to R121 626. • R7 101 and R7 300, you can apply for a FLISP subsidy of up to R102 893. • R21 801 and R22 000, you can apply for a FLISP subsidy of up to R27 960.
Where to apply for a FLISP subsidy
As FLISP is a government-backed initiative, the department of human settlement administers and processes applications for a FLISP subsidy. Once you’ve been pre-approved for a home loan, apply for a FLISP subsidy at your local department of human settlement office, or call the National Housing Finance Corporation.
