Abstract:
Although it is still in its formative stages,
the idea of inclusionary housing in South
Africa’s constitutional context is
inescapable. The typical characteristic of
inclusionary housing is that a developer is required or encouraged to dedicate a specified portion of her housing development
project to the provision of affordable housing. This raises concerns about the possible
violation of developers’ property rights because it affects their investment backed
expectations regarding future earnings. Since municipalities are the chief agents of the
implementation of inclusionary housing, it is important to investigate how they can
respond effectively to the property related concerns of developers. This article conducts an
overview discussion of the concept of property in South African law, with a special focus on
how property regulation can be anchored on the “givings” concept. It then explores the
legal mechanisms through which municipalities can pay financial incentives to housing
developers to ensure the growth of a housing stock that is geared for affordability as well
as social and economic integration. We undertake a critique of the current statutes
governing local government financial management and illustrate their inadequacy. It is
concluded that inclusionary housing can only succeed in South Africa if legal policy
recognises the need for financial payments to developers that go beyond mere
compensation for excessive regulation of property rights.
