To build a decent, flourishing society, we need to build decent housing.

One thing that saddens me profoundly as I drive through the outskirts of our large metros is seeing the endless clutter of tightly-packed shacks. In these slums, millions of our fellow citizens battle to survive in overcrowded, unhealthy, and undignified conditions.

It’s a tangible reminder to those of us fortunate to live with a degree of comfort that informal settlements, which are growing by the day, are indicative of the massive societal ills that plague South Africa and hinder economic growth and stability.

According to the State of South African Cities 2021 report released by the South African Cities Network (SACN), approximately 20% of the population lives in informal housing.

That’s around twelve million citizens compelled to live in environments rife with health problems caused by a lack of sanitation and clean running water. Adding to that are the constant threats of shack fires, flooding, violence, criminality, and xenophobic attacks.

Of course, these issues are hardly new. Our rapidly growing population rate has resulted in an additional ten million births over the last 12 years.

The historical legacy of inhuman apartheid-era spatial planning, which enforced racial segregation, has resulted in the persistence of spatial divisions and disparities in access to essential services, infrastructure, and job opportunities.

Rapid urbanisation has also exacerbated these spatial inequalities. According to the World Bank, SA’s urban population increased from approximately 52% in 1990 to over 66% in 2020.

Since the advent of democracy, the government has performed sterling work building over 3.7 million government-subsidised homes, which included 1.8 million RDP houses built between 1995 and 2005.

But the momentum has slowed dramatically over the last decade, and the government has been unable to keep up with the demand for housing.

The current backlog is around 2.3 million housing units, affecting 3.4 million households. And the extensive waiting periods show little sign of abating. Hence, millions more people have no option but to live in informal settlements.

The lack of student accommodation

Another severe housing problem in this country that needs more attention is the woeful lack of student accommodation.

The demand for affordable, decent student housing greatly exceeds the available supply of accommodation. A situation that leads to inadequate and, at times, unsafe living conditions, especially for students from disadvantaged backgrounds.

Distressing stories abound. Students compelled to sleep in university libraries, computer labs, and even bathrooms are common occurrences. As are students squatting in overcrowded off-campus slums with insufficient access to essential amenities such as water, sanitation, and electricity.

How can these young people be expected to perform in their academic studies when forced to live this way? Is it any wonder why our first-year university drop-out rates sit between 50 and 60%? Is it any wonder why only 4% of students that enrol in Grades one to Grade 12 end up with four-year degrees?

That our university and college students – representing the best and brightest of SA’s youth and the future of the intelligentsia of the country – are being subjected to such dire living conditions is a massive failure for our tertiary education system.


Building sustainable jobs.

This lack of decent housing, the most basic human right, is addressed unequivocally in the South African Constitution. Section 26(1) and (2) of which states: “Everyone has a right to have access to adequate housing (and) the state must take reasonable legislative and other measures, within its available resources, to achieve progressive realisation of this right” (RSA 1996).

So, what can these ‘other measures’ be?

I propose a simple idea based on a startling statistic advanced by the International Finance Corporation (IFC). The FIC estimate that four permanent jobs are created for every average-sized family house built in Africa.

This ratio is based on the findings that 2.9 jobs are created for every house built in the USA. However, as wages are lower in Africa, the FIC estimate that this figure can easily exceed four jobs.

Supposing this ratio is even remotely close to being accurate, then we have an obvious solution to our two biggest socioeconomic challenges. For instance, if the government’s past efforts of constructing 1.8 million RDP houses in 10 years are replicated, it would – according to this 1:4 ratio – create 7.2 million jobs!

It’s fascinating to note that during the fourth quarter of 2022, Stats SA calculated that approximately 7,8 million persons were ‘without work, looking for work and available to work’.

The jobs created would be more than just direct employment in the construction industry. Due to the significant multiplier effect, the construction industry would need to procure many building materials, which would require supply chains that include manufacturing plants, transportation, logistics, related industries, and support services. Additional infrastructure such as roads, water supply, sewage systems, and electricity connections must also be developed.

Suppose such a building programme could be implemented that triggers this 1:4 ratio. In that case, our unemployment and housing crisis can be consigned to the history books. While our economy and our tax base would be boosted exponentially.

Building the war chest needed for a housing programme.

There’s little doubt that promoting a national housing construction programme will have a hugely positive socioeconomic impact. Job creation increases economic activity and improves living conditions that will inevitably contribute to economic growth, poverty reduction, political stability, and social cohesion.

So how to fund such a programme?

Here’s my thinking: According to the Financial Sector Conduct Authority (FSCA) report for 31 March 2020, South African pension funds’ total assets under management amounted to approximately R4.2 trillion.

If the industry invested 5% of these assets as a catalyst to jump-start such a programme, it would amount to R210 billion.

Now, let’s break the construction costs down. Let’s assume a cost of R7 500 per square meter for a modest fifty square metre house, which adds up to R375 000, an approximate average for a low-cost home.

R210 billion would pay for the construction of approximately 560 000 houses. Therefore, using the 1:4 ratio would mean 2 240 000 new jobs created.

Building the economy by building houses has been around for a while.

Part of US President Franklin Roosevelt’s New Deal, which helped end the Great Depression in the 1930s, was the establishment of the Federal Housing Administration (FHA) and the construction of public housing. An initiative that provided jobs stimulated the economy and helped address housing needs.

In post-World War II, Germany implemented a large-scale housing construction programme, which became an effective catalyst for the country’s economic recovery.

South Korea launched an ambitious housing construction program during the 1960s and 1970s that triggered that country’s spectacular economic growth.

China, Singapore, Türkiye - there are numerous examples of rapid economic growth being achieved through large-scale housing construction programmes.

It’s a tried and tested approach that must be evaluated here in South Africa if we’re ever to extract ourselves from this economic and social quagmire that’s hampering our efforts to build a more egalitarian, prosperous society.