FINANCE: FNB Targets Affordable Housing Market
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First National Bank (FNB) has targeted affordable housing as a key growth area, setting a target of financing 100 000 homes in this sector by 2012.
FNB has financed more than 76 000 affordable housing units since the establishment of its affordable housing finance business unit in 2002. The bank aims to finance more than 10 000 housing units by end June 2011 and an additional 15 000 by end June 2012.
Despite the economic downturn and a tough recession, FNB Housing Finance managed to grow its profit from end user finance in this market by 84% in the 2009/2010 financial year.
Marius Marais, CEO of FNB Housing Finance, says this growth emphasizes the importance of being a responsible lender and always putting customers’ needs first.
“The bottom line is that we focused on the quality of the loans granted than on the quantity. This enabled us to endure the hardships of the recession and limit our defaults within acceptable levels.”
Despite huge demand for housing in South Africa there is still an undersupply in the affordable housing market space (currently defined as houses in the R180 000 to R500 0000 price range).
FNB Housing Finance has been working with government and other stakeholders to come up with solutions to address the housing backlog and increase housing delivery.
“At FNB we support government’s drive of developing an integrated human settlement. To us it is more than providing end-user finance to our customers, it is also about enabling and creating sustainable communities through the provision of quality affordable housing and to achieve this it is crucial for all stakeholders to work closely together and share best practises for the benefit of our country,” says Marais.
“As we move out of a recession, and stability returns to the property market, we see tremendous opportunities,” adds Marais. “The rapid growth of our cities, and the increasing demand for affordable shelter, means an ongoing demand for affordable housing. We intend to hold onto our position as a major player in that space, and to ensure responsible consumers have access to the best possible housing finance solution,” he concludes.
Business News Sector Tags: Finance|