WINDHOEK – The average “man on the street” is denied the basic right of owning his/her own home due to commercial banks that fail to come up with innovative ideas and products to accommodate basic-salary income earners.
According to the Kavango Block Brick (K-Brick) company, a major gap exists where income earners get too much for government housing, yet too little for commercial home financing.
“The direct result is many first-time home buyers are unable to enter the housing market at an early stage in life. Even combined household incomes of N$15 000 per month put you in the so-called ‘poor’ bracket. This is due to the fact that joint incomes are not sufficient for home loan finance for conventional housing as prices are too high.
“Banks are not innovative in their thinking. At the end of the day, the banks and legal practitioners are best friends,” Heinrich Schroeder of K-Brick said.
According to Schroeder, commercial banks need to stay well informed about modern building trends and consult experts in the building industry to be able to provide tailor-made home loan packages for different income earners.
He said: “South African commercial banks have seen the gap and home loan packages are more ‘tailor made’ to accommodate people who have been previously excluded from the housing market.”
An initiative which ABSA Bank South Africa recently undertook was to evaluate different innovative housing systems by hosting and being one of the main sponsors of the 2009 International housing competition involving innovative building systems around the world.
Schroeder, who advocates usage of cheaper and environmentally-friendly housing materials, said focus of the competition was to evaluate the sustainability of various innovative non-conventional building systems which scored high marks with regard to social acceptance and structural performance.
He noted that structures were monitored on a daily basis to ensure that construction was in accordance with building regulations and also met the minimum requirements of the National Home Builders Regulation Council (NHBRC).
NHBRC provides a five-year warranty on structural performance. As a direct result of the competition, successful building systems are now listed on ABSA’s approval list for home loan finance, including Namibia’s own innovative Kavango Block Brick.
A similar project consisting of an innovative show village was initiated by the City of Cape Town in 2008.
Schroeder explained that the project was a clear example of the commercial banking sector working in conjunction with the local government to showcase innovative housing, specifically for first-time home buyers who had previously been excluded from the market, either as a result of earning too little for bank finance, yet too much for a government subsidy.
“Such projects, a direct result of South African banks working with the various local government departments, has led to the creation of the ‘GAP’ housing market which Namibian banks need to start addressing as this is the market level which most first-time home buyers fit into. Serious transformation with respect to home loan finance is needed before many Namibians are able to enter the housing market,” the entrepreneur was of the opinion.
Schroeder noted that by introducing a building regulatory body in Namibia, similar to that of the NHBRC in South Africa, the risk factor can largely be shifted from commercial banks, which would hopefully change the mindset of commercial banks to provide finance for affordable housing for all Namibians.
According to Schroeder, commercial banks in Namibia need a serious “shake-up” and the Bank of Namibia needs to put pressure on commercial banks to revise their home loan policies to accommodate the average “man on the street”.
Kavango Block Brick started the long road to success as a small to medium enterprise (SME).
“When approaching one of Namibia’s famous commercial banks for funding, it was clear that Kavango Block Brick was not going to obtain financial assistance. Vision and dedication and not the commercial banks have been the secret of Kavango Block Brick’s success,” he revealed.
According to Schreoder, once success was reached, the Development Bank of Namibia joined hands with Kavango Block Brick to reach the next level.
“K-Brick will be able to deliver in 2011 thanks to the DBN seeing the potential in the internationally-accepted Namibian building technology,” he added.
He advises Namibian SMEs associated with the construction industry to make sure that they have the expertise in line with what they are doing, and ensure they get the correct advice to protect their intellectual property, if they have an invention.
“Ensure you have a clear vision and see the success beforehand. The only way to eat an African elephant is bit by bit. Further advice is to make sure you have no debt.
“Make sure your municipal accounts are up to date and that you have some form of secure income to take care of your family. Forget commercial banks if you have any outstanding debts even if debts are directly related to getting your business off the ground!
“Commercial banks cause many potential emerging SMEs to flap like fish out of the water, as they just cannot get off the ground due to lack of financing,” said Schroeder.
According to the entrepreneur, K-Brick having reached international acclaim is set to demonstrate to the world that Namibians are sitting with the best building systems.
The K-Brick academy will provide training to SMEs in construction to work with the Kavango Block Brick building system.
K-Brick will showcase their different housing options and will launch it in the form of a show village on Namibian soil.
As a launch special, K-Brick will launch a four-bedroom family home that compares to the price of a two-bedroom house.
“It will be a historic occasion, as CNN has been invited to feature our Namibian revolutionary construction system on the programme ‘Inside Africa’,” an excited Schroeder said.
Kavango Block Brick will release its entire product range in the form of an easy-to-follow booklet towards the end of January 2011.
by Irene !Hoaës
www.newera.com.na
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The Facilitators are the One Stop NHBRC Service Centre for all Developers, Contractors and Home Owners. For more information visit our website at:
www.the-facilitators.com
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