A critical evaluation of different models for the possible privatisation of the management of state-assisted rental housing in the Mangaung local municipal area

Abstract

State-assisted housing and low-cost rental housing are of high priority in South Africa as a result of the high unemployment rate, high poverty rate, and a critical undersupply of suitable housing. This became very important in 1994 with the first democratic election of South Africa. The aim of the newly elected government is to provide as many low-cost housing facilities to the poor as possible. A very fine balance should be achieved in the provision of low-cost rental housing and state-assisted housing to the poor. This should be managed in such a way that it will be an ongoing facility and so that as many individuals as possible will be provided with suitable accommodation within the restraints of a limited budget. Management of the low-cost rental housing or state-assisted housing has become extremely important for local government. Effective management can make a major difference in client I tenant satisfaction and cost-effective practice. . The workplace challenge of the Mangaung local municipality represents a challenge experienced by many local municipalities in South Africa. The management of the housing portfolio is an impossible task for many. Variables to take into consideration are housing legislation, the national housing strategy, budgetary constraints, and the socio-economic status of the tenant. A review of relevant management models was conducted. Models including tho~ .:; from the private practice were studied and compared. Special attention was given to all aspects of the management of the low-cost rental-housing portfolio of the Mangaung local municipality. A new model is proposed for the effective management of the Mangaung low-cost housing portfolio. This management model would be suitable for use by other local municipalities. The model will address social upliftment, tenant involvement in management, private partnership agreements and market-related rentals to ensure continued economic viability. Attention is given to feasibility and valuation. The implementation of the model and the timeframe for successful completion are discussed.