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The purpose of this paper is to understand how the nature of infrastructure as a public good has traditionally lent itself to state provision and to review how land-based financing (LBF) can be used to overcome the public infrastructure funding constraints in South Africa.

The paper is largely based on a review and analysis of the academic literature, government reports and reports from research institutions such as the World Bank, Department for International Development, Urban Land Institute and the Lincoln Institute.

The paper finds that although a number of LBF instruments are being used in South Africa, the majority of them are not suited to addressing the current infrastructure funding constraint. However, the paper finds that some LBF mechanisms, such as tax-increment financing (TIF), that are currently not used could play a role provided that certain preconditions are met.

LBF has only partially been implemented in South Africa, thus the paper is limited to exploring the issues, challenges and necessary policy and regulatory changes needed to support LBF.

The review of LBF mechanisms currently being used in South Africa highlights many of their practical limitations. Furthermore, concrete proposals and legislative amendments are proposed in the paper regarding the implementation of additional funding instruments such as TIF.

Infrastructure is regarded as a key precondition for socio-economic development. LBF offers a viable and important alternative for fiscally constraint governments in emerging economies to fund infrastructure provision.

The main contribution of the paper is its focus on the use of LBF in the under-researched Sub-Saharan African context.

The purpose of this paper is to provide an overview of the economics of providing well-located housing in the inner city of Cape Town. The paper emphasises the need to maintain an appropriate balance between the viability and affordability of the product offered to the market and overcoming the value versus cost challenges. While developers have limited influence over value, they do have influence over cost structures through the development approach that is chosen. Moreover, local authorities influence the viability of projects through standards and regulations. The conclusion drawn from the research has considerable implications for the formulation of market-driven housing policy interventions.

In addition to the review of urban economics theory and the literature on the drivers and costs of inner-city, higher-density residential development, a series of interviews with inner-city residential developers was conducted to access current property development cost data and to identify the parameters that determine the viability of inner-city, high-density residential development.

Cape Town, like other South African cities, suffers from being inefficient and inequitable largely due to its low density and sprawling nature. As a result, most planning- and housing-related policy interventions advocate the provision the higher-density, more affordable residential housing in well-located areas such as the inner city. However, to date, these policies have, on the whole, been unsuccessful in achieving these outcomes. This paper argues that this is because these policies largely do not take urban economics into account and fail to address the value versus cost tension that needs to be overcome to allow for the provision of such accommodation. Based on the viability calculations provided, the research illustrates the main cost drivers associated with higher-density, inner-city residential development and makes certain recommendations as to how these cost barriers can be reduced.

Financing arrangements and taxation implications have not been accounted for as these are often specific to the developer and thus cannot be generalised.

The solutions put forward by the paper offer lower-income households the ability to successfully compete with higher-income households and other land uses for well-located space in Cape Town’s inner city.

The findings of this research illustrate the type of interventions that the public and private sectors can consider to improve the viability and affordability of affordable housing units in city centres located in emerging countries.

While traditional urban economic concepts are drawn upon, the paper contributes to addressing the challenge of providing higher-density, more affordable accommodation in South African inner cities. It does this by applying these well-known concepts to the inner city of Cape Town and draws on current data and developer views to accurately diagnose the problem and, in turn, to offer pragmatic solutions.

This paper aims to suggest a practical model for the production of new homes according to demands. After understanding the inhabitants’ priorities and preferences, the authors will present a programming model for building projects. The authors will meet the goal with knowledge-based development ideas and the experiences of skilled engineers and scholars.

The research methods are theoretical studies, a case study strategy, a market analysis, linear planning and classic procedures. All the research methods are problem-oriented. The authors have studied theories related to housing policies and performed field studies with a case study. The case study considers the preferences of applicants and programs building productions according to the ideas and needs.

The outcome of this research is a home-building program. The program stands on the particular requirements of responded people and regional characteristics. The authors can simulate this model anywhere in the world where there is a housing crisis.

This paper is originally based on my studies and practices.