Affordable Housing draws Foreign Investment into South Africa

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Trevor Manuel, Minister in the Presidency for National Planning Commission speaks at 4th Annual IHS Developer Conference 2012 held yesterday at Joburg Country Club Trevor Manuel, Minister in the Presidency for National Planning Commission speaks at 4th Annual IHS Developer Conference 2012 held yesterday at Joburg Country Club

As the affordable housing market continues to grow, the fledgling sector has become an attractive option for foreign direct investment and is starting to outshine its more mainstream equity fund counterparts.

International Housing Solutions (IHS), hosted its 4th annual International Housing Solutions (IHS) Developer Conference held yesterday at Johannesburg Country Club in Auckland Park.

Commenting on the occasion of the full-day event, IHS managing partner Soula Proxenos told SA Commercial Prop News that the sector has become a major player on the South African property scene in the past five years, and has brought much-needed investment to a historically under-served part of the market.

As has become the norm, the invitation-only conference, described as the highlight of the local housing calendar, once again enjoyed overwhelming interest from South Africa’s leading banks, developers, investors, economists, property experts and other stakeholders in the sector, who attended in their hundreds.

Over the past half-decade, IHS has been a pioneer in the affordable housing space, funding quality projects that not only provide shelter, but also assets on which future wealth can be built in community-centered projects. Previously, hundreds of thousands of South Africans seeking to own their own homes were left in the lurch because they either earned too much to qualify for government-funded housing or too little to qualify for a bond in the existing property market. However in past years, the sector has grown and has become attractive not only to funders, but also developers, meaning a consistently improving supply as more are drawn to the market’s potential.

Through its first fund, IHS has been involved in 33 projects in six provinces, and has invested in South African affordable housing projects with a combined total value of more than R7.8 billion, ensuring the provision of much-needed quality homes and apartments.

Says Proxenos: “When IHS started out, the affordable housing sector was an untested and, in the view of some, risky proposition. However as one successful project after another followed, the foresight of and trust in the model by initial investors were affirmed. As a result, we have witnessed a dramatic increase of interest and commitment by serious investors in the public and private spheres, locally and abroad.”

Proxenos says that part of the value that lies in having been a pioneer in the sector, is the early bar that could be set in terms of standards.

“We have always sought to partner with developers who are committed to building real communities with the amenities to support quality living, close to public transport, schools, and economic opportunities.

“As a result, we are witnessing how the growth of the affordable housing sector not only provides above-average opportunities to investors, but also how it is leaving a social impact and legacy on which the country can continue to build into the future.”

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Property Events in South Africa  |  Affordable Housing  |  Housing Delivery in South Africa  |  Annual IHS Developer Conference  |  Trevor Manuel  |  International Housing Solutions (IHS)