FLISP: what it is and why you need to know about it

Private Property South Africa
Tahir Desai

flispMany agents are unaware of a government subsidy that could help their clients who are first time homebuyers enter the property market.

The Finance Linked Individual Subsidy Program (FLISP - www.flisp.co.za) is available to first time buyers in South Africa who earn between R3501 and R15000 per month.

The programme was developed by the Department of Human Settlement to help South African citizens and holders of permanent residence who fall into the ‘affordable market’ – people whose income is regarded as too low to apply for a bond but which falls above government’s requirements for free basic housing.

The subsidy has not been well publicised and as a result take up has been slow, with only 1,696 FLISP subsidies extended in the first two years. Being aware of FLISP will allow you to inform your clients about the scheme and increase their chance of getting on the property ladder, by either increasing their deposit amount or making their repayments more affordable.

Who qualifies?

To qualify for the Finance Linked Subsidy Programme, your client would need to be 18 or older; “competent to legally contract;” fall into the designated earnings bracket; and have obtained a bank’s approval in principle for a home loan.

How does it work?

The size of the subsidy – from a minimum of R20,000 to a maximum of R87,000 is determined by monthly income.

The subsidy can be used to purchase any residential property or piece of vacant serviced residential land. It can also be used towards the cost of building a residence on a piece of land that the applicant already owns. There is no limit on the price of the property that can be purchased.

The applicant would need to find a property that they can afford to buy and a lender that’s prepared to finance the purchase before they apply for the subsidy.

The Programme is administered by the National Housing Finance Corporation SOC Ltd.(NHFC), which accepts and assesses application forms which must be submitted by a regional or provincial office of the Department of Human Settlements, a municipality, an estate agent, or a developer.


If payment is needed to cover the shortfall between the qualifying loan amount and the purchase price of the unit, the money will be paid into the transferring attorney’s trust account on notice of readiness to lodge the transfer documents.

If the payment is going to be used to reduce the principal Loan amount to make the loan repayment instalments affordable, the money will be paid directly into the applicant’s home loan account.

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