Reframing the ‘gap market’: lessons and implications from Cape Town’s gap market housing initiative

Abstract

In South Africa, households which earn too much to qualify for South Africa’s impressive capital subsidy programme and too little to access mortgage finance are referred to as the gap market. As the gap continues to grow, address is of increasing policy priority, a focus of local and national efforts. However, this paper argues that the gap market has been misunderstood and inappropriately framed in South African housing policy discourse. The case study of the City of Cape Town’s ‘Sale of Serviced Erven for GAP Market Purposes’ demonstrates the assumption that the gap market is a functional housing submarket which can be targeted uniformly. This paper argues that the gap market is instead a derivative of South Africa’s housing policy history and premised on the problematic ‘ownership imperative’. While the gap market is a useful conceptual tool to be understood within its historic trajectory, it should be discarded from policy design processes and replaced with more useful categories driven by analysis of the households and dynamics which comprise the market. This argument is relevant for all countries which seek to address gaps in their housing markets.