HUNDREDS of Eastern Cape families could soon be homeless as the Eastern Cape Development Corporation (ECDC) wants them to buy the properties they currently rent at market value or move out by the end of the month.
ECDC said it wanted to capitalise its business, and it has a strategy to dispose of 238 houses.
Tenants in Butterworth are already feeling the pressure of evictions as ECDC seeks to sell its houses to capitalise its development core business.
ECDC tenants, supported by South African Civic Organisation (Sanco) protested against the new strategy last month but ECDC would not back down. It said it had offered the tenants of its 238 standalone houses the first right of refusal until March31 to buy the houses.
ECDC said it intended to dispose of the entire residential portfolio, which has been a cash drag on the institution as it is owed about R60- million in rentals by its tenants despite ECDC having the lowest rentals in the market.
“From December 2012, ECDC offered the tenants of its standalone units the first right of refusal to buy the houses.
“They have until the end of March to make offers to the corporation. Thereafter, the offer to buy the houses will be made open to the public in line with the ECDC Act and the Public Finance Management Act (PFMA),” said ECDC chief executive Sitembele Mase.
“Since December, we have been processing more than 40 tenant offers which have already been accepted and signed by ECDC. It is anticipated that by March the vacant houses will be advertised for sale ,” said Mase.
The Daily Dispatch reported last month that Butterworth residential property tenants protested against their eviction while business tenants in Mthatha protested last week, claiming the ECDC had kicked them out despite their right of first refusal.
The houses form part of the financier’s 473 residential properties which have a balance sheet value of R233-million, ECDC claimed in a media release.
It further claimed to have 170 standalone houses in Butterworth, 64 in Mthatha and four in Queenstown, in addition to another 19 vacant houses which will be disposed of through a public process.
The issue has gone through the courts and has been a bone of contention since 2004.
ECDC inherited the properties as the “most significant” part of its capitalisation. The financier said residential property management distracted it from fulfilling its development finance role of stimulating economic growth.
“The ECDC Act states that only economic considerations should be taken into account in decision- making regarding the disposal of assets. This means the economic value of the houses must be realised and the value of the properties is determined by market mechanisms such as independent valuations ,” Mase said.
Tenants in Butterworth had stated that houses should be sold to them at construction value.
In a previous exercise conducted by Grant Thornton in May 2007, it was established that 18 % of ECDC tenants fell below the bracket of medium to high income earners with monthly incomes of between R7500 and R20000, said Mase.
The ECDC intends to provide relevant support for this possible indigent group according to the government indigent policy, said Mase. —
ECDC pressures EC families to buy their homes
ECDC said it wanted to capitalise its business, and it has a strategy to dispose of 238 houses.
Tenants in Butterworth are already feeling the pressure of evictions as ECDC seeks to sell its houses to capitalise its development core business.
ECDC tenants, supported by South African Civic Organisation (Sanco) protested against the new strategy last month but ECDC would not back down. It said it had offered the tenants of its 238 standalone houses the first right of refusal until March31 to buy the houses.
ECDC said it intended to dispose of the entire residential portfolio, which has been a cash drag on the institution as it is owed about R60- million in rentals by its tenants despite ECDC having the lowest rentals in the market.
“From December 2012, ECDC offered the tenants of its standalone units the first right of refusal to buy the houses.
“They have until the end of March to make offers to the corporation. Thereafter, the offer to buy the houses will be made open to the public in line with the ECDC Act and the Public Finance Management Act (PFMA),” said ECDC chief executive Sitembele Mase.
“Since December, we have been processing more than 40 tenant offers which have already been accepted and signed by ECDC. It is anticipated that by March the vacant houses will be advertised for sale ,” said Mase.
The Daily Dispatch reported last month that Butterworth residential property tenants protested against their eviction while business tenants in Mthatha protested last week, claiming the ECDC had kicked them out despite their right of first refusal.
The houses form part of the financier’s 473 residential properties which have a balance sheet value of R233-million, ECDC claimed in a media release.
It further claimed to have 170 standalone houses in Butterworth, 64 in Mthatha and four in Queenstown, in addition to another 19 vacant houses which will be disposed of through a public process.
The issue has gone through the courts and has been a bone of contention since 2004.
ECDC inherited the properties as the “most significant” part of its capitalisation. The financier said residential property management distracted it from fulfilling its development finance role of stimulating economic growth.
“The ECDC Act states that only economic considerations should be taken into account in decision- making regarding the disposal of assets. This means the economic value of the houses must be realised and the value of the properties is determined by market mechanisms such as independent valuations ,” Mase said.
Tenants in Butterworth had stated that houses should be sold to them at construction value.
In a previous exercise conducted by Grant Thornton in May 2007, it was established that 18 % of ECDC tenants fell below the bracket of medium to high income earners with monthly incomes of between R7500 and R20000, said Mase.
The ECDC intends to provide relevant support for this possible indigent group according to the government indigent policy, said Mase. —
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