Soweto is the largest township in South Africa, comprising a vast diversity of people and ethnicities. The township was officially incorporated into the City of Johannesburg in 2000 and now comprises nearly a third of the City’s population.
In Soweto, like many parts of South Africa, the unprecedented urbanisation has made it impossible for local governments to meet the rapid demand for housing and other basic services. There is an increasing gap between supply and demand, affecting affordability. In previous years, this saw the rise of many informal settlements proliferating the urban landscapes. In recent years however, our cities have seen the growth of informal settlement give way to the proliferation of backyard dwellings as the dominant form of both formal and informal housing supply. Whereas backyarding is increasingly recognised as an important informal contributor to housing options, a nuanced understanding of backyarding dynamics remain somewhat elusive due to, inter alia, its uneasy relationship with housing policy (e.g. ‘double-dipping’) and the variety of social and physical manifestations of backyarding (i.e. from accommodating extended family to supplementing income, and from shacks built from corrugated iron sheets to high quality extensions to existing dwellings).
Unlike Reconstruction and Development Programme (RDP) housing, backyard dwellings offer the geographic flexibility to respond to changing employment opportunities. Unlike informal settlements, backyard dwellings allow for immediate access to service. According to the findings of a recent Quality of Life Survey in Gauteng province, households living in backyards experienced the biggest improvement in quality of life compared to households living in formal structures or in informal settlements.
The team in Soweto undertook to gain better insights into the backyarding sector of Soweto, not only as a vital means to income, but also as part of the land value capture process. The focus of the Soweto Strategic Area Framework covers 38,400 households. This same area has 40,500 backyard structures, varying from shacks (that is, built from temporary materials) to high-quality rental accommodation, and built without one cent of government subsidy. For the government to house that many households would require the equivalent of three Cosmo Cities.
The income earned through renting out the backyards of government-subsidised houses in Soweto not only has a significant impact on the local economy, but also has an important part to play in furthering the Future Cities South Africa programme's (FCSA) gender and social inclusion (GESI) agenda. From our analysis we found that most homeowners remain unemployed or with insecure or intermittent employment. Most RDP homeowners acquired houses for free without a commensurate improvement in financial status and therefore renting out their property to backyarders affords them some form of stable income. Every year, we estimate that more than half a billion Rand of backyard rental income is transferred in the study area alone from renters (who tend to be younger, more mobile, more multinational, better educated and more likely to be employed), to homeowners, who tend to be older, female, unemployed and with a higher incidence of functional illiteracy This is approximately 5% of the total annual disposable income in the study area.
Some fast facts about the study area’s property market:
According to Lightstone (2020), data, of the 38 400 formal residential properties in the study area, 69% of homeowners are older than 64 and an additional 19% are older than 50.
47% of formal houses in the study area on separate stands were owned and fully paid off, compared to 31% for Johannesburg as a whole and 36% for Gauteng.
54% of fully paid off formal houses in the study area belong to female-headed households, compared to 43% for Johannesburg.
The residential property market in the Soweto study area has created more value for local households than any other driver for which longitudinal data exists, with Soweto housing values growing nominally at 53% between 2012 and 2018 compared to 23% metro average. Our housing market assessment conducted last year concluded that significant latent demand exists for additional micro-development of rental units, particularly in the R1500-R2500/month rental band. The study found that the market should be able to meet existing demand without significant changes to development guidelines, and in doing so generate significant up- and down-stream economic opportunities in construction, accommodation and business services.
Harnessing evident latent demand for affordable rental stock requires the deliberate enablement of micro-development by homeowners in appropriate precincts. Spatially targeted enabling interventions include (1) reducing the cost and complexity of getting building plans prepared and approved, (2) creating an overlay zone to encourage and create clarity for micro-development, (3) conduct a study to determine impact of existing and future backyarding on local infrastructure capacity, (4) apply for USDG funding to increase infrastructure capacity, (5) facilitate the establishment of an accredited list of small scale local building contractors and credit providers, and (6) a series of workshops in targeted areas to create necessary awareness of small scale rental to individual property owners.
More about FCSA Programme's intervention in Soweto please read here.
 Soweto is located towards the southwest of Johannesburg, South Africa. The township was established during the gold-rush and as a result of the oppressive apartheid regime.
 Jan K. Brueckner, Claus Rabe, and Harris Selod, ‘Backyarding: Theory and Evidence for South Africa’, Regional Science and Urban Economics, 79 (2019), 103486 <https://doi.org/10.1016/j.regsciurbeco.2019.103486>.