Cost-benefit Analysis of RDP versus Social Rental Housing


The CBA provides an economic perspective on investments in housing by identifying and quantifying costs and benefits wherever possible. Importantly, as an economic tool, the CBA, quantifies direct and indirect costs and benefits in monetary terms, and discounts these values over time, to allow for an accurate comparison.
The quantification of costs and benefits is important as it allows for a more objective comparison to be made between the total effects on society of RDP and SRH. For analytical purposes, financial, economic and distributional analysis is distinguished within the CBA. The financial analysis considers the costs of the project, taking into account and correcting (as far as possible) pricing and other
distortions. The economic analysis considers primary and secondary effects that result from the project and aims to quantify these as far as possible. Finally, the distributional analysis seeks to assess where the incidence of cost falls, that is who the primary beneficiaries of the project are and the main carriers of the cost burden.
In order to analyse the relevant aspects of housing, the primary intended effect of SRH is defined as being:
• to contribute to urban restructuring in order to address structural
economic, social and spatial dysfunctionalities; and Cost-Benefit Analysis: Social Rental Housing and RDP Housing Final Report
Social Housing Foundation Page ii
• to improve and contribute to the overall functioning of the housing
Based on these policy goals, several measurable variables were defined resulting from the characteristics of SRH compared to RDP housing, including effects on employment, education, health and crime. The costs and benefits of six actual projects were analysed. The principal analysis was based on comparisons of the Bram Fischerville RDP project and the Roodepoort SRH project both located in Johannesburg, and on RDP housing in
Potsdam and the Amalinda SRH housing project in East London. The analysis was supplemented with further information from the Tokologo / Mhluzi Ext 2 RDP project and the Hope City SRH project in Middelburg. Extensive primary data was collected from the six projects, including project documentation and a series of interviews with key practitioners involved in the projects. This was supplemented by secondary data; causality relationships were
established; a review of empirical and theoretical literature was undertaken, as well as engagement with an expert panel (the Project Reference Group). A detailed survey of 550 households was conducted to measure impact and effects.


Evaluation Number:
Report Approval:
Saturday, 31 January 2009
Tuesday, 17 September 2013
Initiated By:
Social Housing Foundation, Department of Human Settlements
Undertaken By:
Rhizome Management Services
Evaluation Period:
Evaluation Area:
Housing and infrastructure
National Outcome:
National Outcome 8: Sustainable human settlements and improved quality of household life.
Commissioned By:
Evaluation Type:
Evaluation Subject:
Geographic Scope:

Evaluation Documents

File Name
CBA_main_report sm.pdf 215.pdf

Similar Evaluations

Evaluating the Perfomance of Social and Rental Housing Programmes

The Mid Term Review- 1Report[August 2003] of the Support Programme for Social Housing[SPSH] stated that in the period between 1995 and 2000,very little actual delivery of social housing units had...
Evaluation Number:
Report Approval:
Wednesday, 01 September 2010
Monday, 28 January 2013
Initiated By:
Department of Human Settlements

Report on the Evaluation of the Impact of the Rural Housing Programme 2009/2010

In August of 2009 the Department of Human Settlements commissioned a research study which focused on evaluating the impact of the Rural Housing Programme. The Rural Housing Programme is aimed at...
Evaluation Number:
Report Approval:
Monday, 30 August 2010
Wednesday, 18 May 2016
Initiated By:
Department of Human Settlements

Housing Subsidy Scheme Impact Evaluation

The purpose of the evaluation was to evaluate the impact of the Housing Subsidy Scheme for the period 1994 - 2002. This was articulated in the request for proposals.
Evaluation Number:
Report Approval:
Friday, 29 April 2005
Thursday, 19 May 2016
Initiated By:
National Department of Housing

Synthesis evaluation of whether the provision of state subsidised housing addressed asset poverty for households and local municipalities

The purpose of this evaluation is “… to determine if the provision of state subsidised housing has addressed asset poverty for households (are subsidised houses growing in value and are beneficiaries...
Evaluation Number:
Report Approval:
Monday, 26 October 2015
Monday, 23 May 2016
Initiated By:
Department of Human Settlements

Measuring Success in Human Settlemens Development: An Impact Evaluation Study of the Upgrading of Informal Settlements Programme in selected projects in South Africa

The evaluation was conducted as part of a technical assistance initiative organised between the World Bank and the South African Government. As such, the entire initiative was considered to be a...
Evaluation Number:
Report Approval:
Tuesday, 31 May 2011
Wednesday, 25 May 2016
Initiated By:
National Department of Human Settlements