Nedbank and the DBSA’s Green Fund will jointly fund the development of around 400 sustainable homes for the affordable housing market.
Approximately 400 affordable green housing units will be developed in the Western Cape and Gauteng after an agreement for joint funding was finalised in November 2015.
The agreement between Affordable Housing Development Finance at Nedbank Corporate and Investment Banking (NCIB) and the Green Fund, managed by the Development Bank of Southern Africa (DBSA) on behalf of the National Department of Environmental Affairs (DEA), is made possible through the creation of an earmarked R120 million concessionary loan funding pool to be administered by Nedbank.
“Green affordable housing combines social and environmental sustainability to promote access of lower- and middle-income individuals to better quality housing units with lower running costs,” says Manie Annandale, Head of Affordable Housing Development Finance at NCIB.
The agreement also includes the monitoring of energy and water consumption in the green affordable housing units to verify their actual savings.
Lower lifecycle costs make green homes particularly attractive to the affordable housing market. “Utility bills amount to 10-20% of the rental or bond instalment, pushing a household’s accommodation-related expenditure up to 40-50% gross income, and placing pressure on affordability. Meaningful savings in electricity and water bills can reduce the likelihood of default on rentals or bond payments, and help to improve access to housing for new market entrants,’’ notes Annandale.
The recently launched Excellence in Design for Greater Efficiencies (EDGE) tool that will set the benchmark for environmentally sustainable housing, requires savings of at least 20% in energy, water and building material embodied energy. It is anticipated that a family of four living in a new two-bedroom unit compliant with EDGE and SANS 10400-XA could save between R350 and R450 per month, compared with an older conventional unit with no energy-efficiency features.
Beside the 400 families that will benefit from these developments, the demand for green housing technologies is anticipated to stimulate local industries and potentially create new jobs.
For more information, please send an email to The Green Fund at email@example.com.