THE affordable housing sector is the future lifeblood of the market. Major banks are now waking up to this reality and focusing on this segment of the housing market.

The affordable housing bracket caters for households with a monthly income from R8,000 to R15,733.

These usually also get a full loan for their bond and can typically afford a house of up to R500,000.

Currently the South African bond market is sitting at more than R900billion and Standard Bank has a good share with about R250-billion of the market.

The bank claims to be the leading financier of the affordable housing sector, with bonds to the value of R10.7-billion.

The bank is housing about 10,000 families.

"Of the bank's 9million clients, 7million fall in this category. Keep in mind that many of these clients are young people," said Nicholas Nkosi, director for affordable housing at Standard Bank.

He said this sector of the market was most active right now.

"Two years ago an affordable house was R250,000.

At present, the going price for a house is R320,000.

Funeka Ntombela, director of home loans at Standard Bank, said: "The demand is there. Capacity is the issue so we are working with developers. Developers are very keen and many are almost exclusively focusing on affordable housing.

"Land is an issue, though. To find suitable land and bulk infrastructure developers have to do the bulk infrastructure themselves - sewage pipes, roads, storm water drainage - that pushes the price up."

Ntombela said banks assessed developers and have in the past rejected many developments because they are not satisfied with the quality of the material or cost of development and therefore price of the house among other factors.

She said clients should, however, do their own quality assurance.

Ntombela said the R1-billion insurance for the gap market - households with an income of less than R8,000 - referred to by Minister of Human Settlements Tokyo Sexwale, was still under discussion.