FCT to tackle 1.7m housing deficits with PPP

The Federal Capital Territory Administration (FCTA) is set to address 1.7 million housing deficit in Abuja through Public-Private Partnership program initiated to benefit many low income earners.

FCT Minister Malam Muhammad Musa Bello made this declaration at the 12th Abuja international Housing Show in Abuja.

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The minister said that the government had formulated a National Housing Policy since 1991 to ease the provision of adequate, accessible and low-cost housing for its citizens.

Bello who was represented at the event by the Coordinator, Abuja Metropolitan Management Council (AMMC) Umar Shuaibu noted that the housing initiative was not realized due to several factors ranging from lack of political will, policy inconsistency, poor financing to weak institutional structures.

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“The revised policy established financial institutions and procedure that will make funds available through the primary mortgage institutions for affordable housing production. The new policy, therefore, acknowledged the private sector as a key partner in the delivery of housing for the country,” he said.

Malikatu Umar Shuaibu

 

Dangote, BUA to partner FMBN on housing delivery

Alhaji Aliko Dangote and AbdulSamad Isyaku Rabiu, chairmen and CEOs of Dangote and BUA Groups of Companies respectively, are set to partner the Federal Mortgage Bank of Nigeria (FMBN) towards boosting affordable housing delivery for Nigerians.

Dangote, who ranks as Africa’s richest business magnate and Isyaku Rabiu, a leading Nigerian businessman are Africa’s two largest producers of cement, a critical input in the housing construction industry.

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They extended the hand of partnership to FMBN during a joint courtesy call on the bank’s board of directors recently.

The President and CEO of Dangote Group said his company was ready to collaborate with FMBN towards lowering the housing deficit by increasing the tempo and scale of social housing provision across the country.

Dangote advised FMBN to consider adopting mass housing models that have worked in other countries such as Ethiopia.

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The chairman of BUA Group of Companies, AbdulSamad Isyaku Rabiu, also said he was committed to a close partnership with FMBN.

Malikatu Umar Shuaibu

Oyo-Ita, Ghanaian Minister provides solution to fix housing deficit

Says 55, 000 civil servants subscribed for FISH housing scheme

Head of Civil Service of the Federation, Mrs. Winifred Oyo-Ita, and Ghanaian Deputy Minister of Works and Housing, Hon. Freda Prempeh have called for increased Public Private Partnerships (PPP) to fix housing deficit in the country.

The dignitaries including the Minister of Power, Works and Housing, Babatunde Fashola made the call during 12th edition of the Abuja International Housing Show, held at the weekend in Abuja.

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It was themed: Driving Growth and Sustainability in Nigeria’s Housing and Mortgage Markets-Improving Structures and Policies for impact.

The HOS, represented by the Permanent Secretary, Welfare Office, Mrs. Didi Walson-Jack disclosed that about 55, 000 civil servants have subscribed for the Federal Integrated Staff Housing (FISH) programme.

Oyo-Ita restated Federal Government commitment to addressing the housing deficit stressing that there are other ongoing programmes to ensure affordable housing delivery.

“This is an indication of the desire of key stakeholders in this sector not only to fill the gaps in the housing sector in terms of quantum but also to ensure qualitative delivery. The FISH programme is being delivered in partnership with private sector organisations, either as estate developers or financiers.”

Theme of the expo, she stated was timely as it highlighted challenges of affordable housing in the country and West Africa sub region.

Earlier, the Ghanaian deputy minister identified high cost of building inputs, access to land title, poor land system and infrastructure cost as challenges bedeviling the sector.
Aside, Hon. Prempeh attributed corruption and selfish interest as another setback of the built industry.

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However, she called for the adoption of modern technologies and need to partner with the private sector.

According to her, houses should be built in districts to reduce cost and achieve affordability, adding that more than 60, 000 acres of land have been earmarked for low income earners in Ghana.

“Partnering with the private sector the more will help provide affordable housing for Nigerians,” she said.

The Minister of power, works and housing, Fashola, while declaring open the conference restated federal government’s commitment to providing sustainable affordable housing to the people.

Fashola said there are ongoing policies aimed at providing access to mortgage finance at single digit interest rate.

The minister said that the current administration has initiated a new policy towards better housing delivery nationwide.

“As our demography is increasing, there is need to multiply the structure to reduce cost of housing with efficient consideration methods.

“It is our goal as a government to industrialise the building and housing delivery process in Nigeria and ensure that the building components are manufactured in the country.”

Fashola was eventually awarded by organisers of the show.

Obaseki to Edo workers: Embrace housing scheme

The Edo State Governor, Mr. Godwin Obaseki, has urged the state government workers to embrace the federal government housing scheme to enable them become homeowners after retirement.

Obaseki gave the advice on Friday in Benin during a sensitisation programme on the federal housing mortgage scheme for public sector workers in the state, organised by the Nigeria Labour Congress (NLC) and the Trade Union Congress (TUC) in conjunction with the Federal Mortgage Bank of Nigeria (FMBN), in Benin City.

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He noted that the implementation would cut across all the 18 local government areas of the state with special considerations for teachers as an incentive to boost their productivity.

The governor said: “Under my watch all the workers that register for this housing mortgage scheme will benefit from it. I am aware that there was the fear of fraud in the past, let me assure you that such fear has been eliminated.

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“I urged you all to take your sensitisation programme here very seriously as it will help you understand what the scheme is all about.”

Earlier, the Deputy General Manager, Federal Mortgage Bank of Nigeria (FMBN), Mr Victor Okosu, said that the sensitisation programme was designed to enlighten the workers on the need to key into the mortgage scheme as 30 states of the country have signed up for the product.

The Edo State chairman, Nigeria Labour Congress, Mr Emma Ademoku, noted that the workers are deeply involved in the sensitisation programme.

Ademoku applauded the state government for providing land for the housing scheme, and said the three senatorial districts would benefit from the scheme.

He commended the governor for paying the salaries of workers in the state even when other state governors are waiting for federal allocations.

Fashola canvasses industrializing development to make housing affordable

Fashola who was the keynote speaker at the just concluded  Abuja International Housing Show (AIHS) in Abuja, the federal capital territory, explained that industrializing the sector would not only drag down the cost of construction, material wise, but would also create jobs for those involved in the housing value chain including input manufacturers, professionals and artisans.

But stakeholders in the sector, who affirmed the minister’s proposition, argued that the problems and challenges of housing development in the country find explanation more in government’s failure to either initiate housing policies and programmes or to implement existing ones.

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“When you look at housing, you see that it is not something that government can look away from because it is very important for various reasons. You can see the contribution of real estate to GDP which is about 7 percent; you also look at its effect on job creation, quality of life of citizens”, the stakeholders noted.

It is an established fact that, of the basic needs of human beings, after food, the next thing is shelter. A man that does not have a home cannot be productive because his heart and mind are not at rest.

Housing also impacts on security because a man that does not have a house lives on the street and becomes a security risk to every other person. He is vulnerable to attack and is also ready to attack other people out of anger and envy.

These are part of the reasons the stakeholders insist that government must perform its duty to make housing affordable by providing infrastructure and coming up with a policy framework in the financial sector that will make mortgage accessible and affordable through a significant reduction in interest rate.

“The housing market behaves in a particular way; it gravitates where there is effective demand. Government should recognize that the weakest demand comes from the low end market and so should direct regulatory system towards that end with a view to making a policy to address that problem”, said Femi Adewole, managing director, Shelter Afrique, Kenya.

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Adewole Added that the government should also adopt the zoning system through which it would discover areas where housing need is highest and the type of housing that they need just as it should impose heavy tax on houses that are unoccupied to discourage further development there.

Hakeem Oguniran, outgoing managing director of UPDC, agreed , but advised that developers should look away from the traditional way of sourcing construction finance from the banks with their high interest rate.

“From my experience as a developer, finance constitutes about 15-18 percent of construction cost”, he noted, advising that developers should source funds from the capital market by raising bonds which reduces interest rate and, by extension, reduce the price of houses.

Land is another aspect of housing that government should do something about in order to make housing affordable. This, it was noted, also constitutes about 20 percent of construction cost. Government was asked not to see land as a revenue generating venture for the government so that it should not be more than 5-6 percent of construction cost.

Increased housing affordability coming on CBN’s mortgage guarantee initiative

In no distant future, increased affordability will be coming into the Nigerian housing market on the back of Central Bank of Nigeria’s (CBN’s) new mortgage initiative known as mortgage guarantee programme which seeks to bring more home seekers into the mortgage net.

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Affordability has always been a big issue in the Nigerian housing market because most of the people who need houses cannot afford them because Nigeria has one of the most expensive housing markets in the world. This is also a country where it is believed that mortgage is non-existent because what is available as mortgage is neither accessible nor affordable to over 70 percent of the population.

But a guaranteed mortgage is here. It is a mortgage given to a borrower by a lender where an identified third party will take responsibility for the loan if the borrower defaults. Expectation is that this will push up housing affordability because, with the new programme, once a borrower defaults, the third party receives a claim from the lender, pays the lender off, and assumes responsibility for the mortgage.

“A quality mortgage guarantee programme is used to provide credit loss protection to lenders in case of borrower default”, explained Tokunbo Martins, Director, Other Financial Institutions Supervision Department (OFISD) at CBN, who spoke at the on-going Abuja International Housing Show in Abuja.

“Mortgage guarantee products incentivize lenders to accept loans with lower down-payments, thus increasing affordability”, she added. The implication of this is that borrowers who, ordinarily, would not have qualified for mortgage loan by reason of their low income, can now obtain loans which enhances their affordability.

In most cases, the national government is the driver of any successful mortgage guarantee programme which they administer through either a government agency, a private entity or a hybrid encompassing both types of entities.

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The programme comes with a lot of benefits and, according to Martins, its importance in Nigeria cannot be over-emphasized given that this is a country where typical down-payment is over 20 percent with extremely high additional costs for regularization, titling and other home buyer responsibilities.

“Mortgage guarantee in our market will also be used as a valuable tool to regularize and standardize the market in every area from documentation to underwriting to collateralization and mortgage dispute resolution. These are major issues we need to resolve”, she advised.

Essentially, mortgage guarantee is a product of great value to any housing market because it is a tool of opportunity for both the supply and the demand sides of the mortgage market and Martins notes that it provides potential opportunity of lower down-payment for borrowers, while opening up a larger market for lenders who make the decision to finance the target population for the programme.

Martins highlighted the main benefits of the programme as increased access to housing finance, access to higher amount mortgages, better loan terms (rate, term etc), market standardization and increased consumer literacy, more stable property values, and more stable and improved national housing sector leading to better economy.

She stressed that a major benefit of the programme is its capacity to encourage the influx of investor funds – both local and international, explaining that a well-executed mortgage guarantee programme provides comfort to intending investors by signaling the presence of standards in the industry that could reduce the risk of losing their invested funds.

The good news on this programme is the role being played by the Nigeria Housing Finance Programme (NHFP). This is a programme daily implemented by a Project Administration Team (PAT), domiciled in thde OFISD at CBN.

NHFP, which is the result of a PPP between the Federal Government, CBN and World Bank, is working in collaboration with its stakeholder partners currently in the feasibility study stage of establishing a pilot company, to be known as The Nigeria Mortgage Guarantee Company (NMGC). “This effort is meant to offer Mortgage Guarantee in Nigeria”, Martins revealed.

Experts advocate tax reduction on building materials to check housing deficit

Task govt on funding, infrastructure development

To address the housing deficit in Nigeria, there is need for government to provide proper infrastructure, finance, creative and workable policies, experts have said.
The experts, who gathered at the breakfast meeting organized by Nigerian-American Chamber of Commerce (NACC) in Lagos, want government to be more involved and deliberate in building mass houses for its citizenry.

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Managing Director, TAF Africa Homes, Mustapha Njie, said government should reduce or remove taxes on building materials for construction of houses providing tax incentives for companies involved in producing local materials.

He said federal government should also declare a state of emergency with a certain percentage of the yearly budget dedicated to the housing sector.

Njie who was represented by his Legal Adviser, Lucky Kawekwune, listed some of the challenges bedevilling the sector to include lack of creativity in the architectural design of affordable housing, access to land inadequate financing both in construction and off take finance.

He noted that government needs to review the Land Use Act of 1978 to make land acquisition and transfer easier thereby encouraging use of local building materials for construction.

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Acting Head, Real Estate Finance, Stanbic IBTC Plc, West Africa, Tola Akinhanmi, said finance plays a vital role in unlocking the potential and assets in the sector, stating that more needs to be to allow exchange and transfers of titles creating developers with mortgage facilitates.

Chairman, Knightstone Properties, Adeniyi Jones, said government must have a creative way of planning to address the housing deficit in the country.

He said the real estate sector is one of the contributors to the Nigeria economy.

Earlier in his remarks, National President, NACC, Oluwatoyin Akomolafe, realizing the importance of secured access to land as a fundamental challenge to housing delivery in the country, successive governments have developed and created government residential layouts in the several locations within the country.

Some of these residential layouts, he said were fully and partly developed with housing units and sold to the public while the rest were developed and created as site and services schemes and allocated to members of the public.

Akomolafe said it is regrettable that despite policies, institutions and regulations which various Nigerian Governments including the State Government have put in place since independence, the task of instituting efficient, effective, affordable and sustainable housing delivery processes continues to challenge policy makers even as the problems of the housing sector worsens.

Don urges FG, states to replicate Jakande housing scheme to bridge deficit

Prof. Gbenga Nubi, Director, Centre for Housing Studies, University of
Lagos, has urged the Federal and state Governments to replicate the
then Jakande Mass Housing Scheme to bridge housing deficit in Nigeria.

Nubi made the call on Wednesday in Abuja at the ongoing 12th Abuja
International Housing Show organised by FESADEB Communications Ltd.

The Housing News reports that Nubi was speaking at the
stakeholders’ session on the theme “Addressing Knotty Issues in
Housing Delivery’’.

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Nubi wondered why the country could not make things right in housing
delivery after the pacesetting and impactful mass housing scheme of
Alhaji Lateef Jakande, former governor of Lagos state in 1978.

“It is the responsibility of the government to provide housing for its
citizens, make infrastructure worthwhile and building materials
possible to access.

“Every responsible government can follow employee housing scheme of
Jakande, the government can replicate Jakande housing scheme to bridge
deficit and achieve affordable housing.

“Land Use Act is not the problem hindering housing delivery in the
country, rather how the government interprets it and go about it is
the problem,’’ the expert noted.

He noted that the Jakande housing scheme sold two bedrooms flat for
N2, 500 as against N50, 000 being obtainable in the market then.

According to him, if the government can emulate such feat, it will
assist the civil servants and other Nigerians to own affordable
houses.

Also speaking, Dr Chi Akporji, Executive Director, Nigeria Mortgage
Refinance Company (NMRC), endorsed the replication of the Jakande
housing scheme of in the states.

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According to her, the states can make concerted effort in replicating
the scheme because it was highly regarded and commended all over the
country.

Akporji noted that the NMRC has evolved a technology platform which
allowed the stakeholders and key players in the industry to come
together with the goal of reducing housing cost and increase housing
efficiency.

She decried cases of unoccupied houses in Abuja and other places in
the country, adding that studies have revealed that the houses where
used by corrupt people to dumb stolen money.

“Houses are the easiest place to hide stolen fund, the owners do not
care about how long they stay redundant but just to hide ill gotten
wealth there.

“Government can prevent such things from happening, some states are
now forcing people to occupy such houses or lose them,’’ she said.

Rev. Chime Ugochukwu, National President of Real Estate Development
Association of Nigeria (REDAN) noted that one of the knotty issues in
housing delivering was land administration issues.

Chime stated that land has a lot of characters including land
registration, titling issues and restiveness in some communities.

He expressed regret that in some places housing developer could not
have access to the land due to some spiritual issues and other issues.

He hoped that the show would come up with recommendations which would
enhance housing development in the country.

The show is a unique one for construction industry stakeholders
presenting new products, innovation services and technology to proffer
solution to housing problems.

The show, scheduled to hold from July 16 to July 19, has its theme as
“Driving Growth and Sustainability in Nigeria’s Housing and Mortgage
Markets-Improving Structures and Policies for Impact.”

Housing Show: NGO seeks partnership with FG to shelter indigent women

The Women in Housing Sector Initiative (WIHSI), a housing NGO, has
appealed for Federal Government’s partnership, to achieve its
objective of providing affordable housing for indigent women.

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Mrs Adenike Fasanya-Osilaja, Founder of the NGO, made the appeal
during the convention of the NGO on the sideline of the ongoing 12th
Abuja International Housing Show, organised by FESADEB Communications
Ltd.

WIHSI Promotes the visibility, advancement and well-being of women in
the housing sector and advocates increased empowerment of women
through housing stability and home ownership.

Fasanya-Osilaja, an International Housing Finance Consultant noted
that the NGO, was focused to ease the plight of indigent women, who
were victims of catastrophic circumstances.

Fasanya-Osilaja said that the NGO was interested in working with the
government at all levels, to identify and prepare women for duties and
privileges of home ownership.

According to her, women have typically been the silent unseen partners
in housing arrangements since the olden days, even though in several
cultures women could still not own land or property in their names.

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“This has created a position of great vulnerability for women, who
literally have a roof over their heads at the mercy of one man or the
other in their lives.

“The woman’s capacity to have enjoyment in her residence is also
directly affected by her relationship with the benefactor, who it is
his cultural right to evict her from the property for any reason at
any time.

The consultant stated that in Nigeria the cultural norm was for a
husband to evict a spouse in case of divorce or separation.

She noted the death of a spouse as another prevalent cause of
eviction for women in many Nigerian cultures, noting that the eviction
typically involves the children too.

“This is why the WIHSI, an NGO formed by women professionals in the
housing sector, has created a highly specialised platform to assist
our sisters with this type of need.

“The platform, aptly named `Housing Women, Housing our Future’ is
created out of the recognition that those of us with expertise in the
sector must pool talents together to support women.

She said “Operation Earn Your Own Home’’ was the pilot programme of
the NGO, to ensure that every displaced woman, who achieved home
ownership through grant passed it on through specific steps.

According to Fasanya-Osilaja, WIHSI is interested in working with the National Assembly. She said “We are aware that the National Assembly of Nigeria for instance is building about 6,000 property units in the very near future.  We would be very privileged to be assigned a number of units, precisely 500 units for a start, for the afore-mentioned pilot project. ”

She added that “Our capacity to effectively administer the proposed pilot project is not in doubt, and our integrity is indisputable.  We would, of course, be happy to have the project monitored by agreed an agreed third party”

Also speaking, Dr Chi Akporji, Nigeria Mortgage and Refinancing
Company (NMRC), advised the NGO to key into its Corporate Social
Responsibility Programme, which had empowered many artisans.

Akporji said that NMRC was planning to wrap up the programme by
involving many women to enhance the sector skill.

FG to Focus on Local Production of Building Materials

Minister of power, works and housing, Babatunde Fashola says the government will ensure local production of building materials to bring down the cost of housing in the country.

The minister who spoke at the 12th Abuja international housing show said the new policy will make the housing sector vibrant and create jobs

Affordable housing for all Nigerians has remained a major challenge with reports from experts pegging the country’s current housing deficit at seventeen million units.

Key players from the housing sector have blamed the soaring price of accommodation on high cost of building materials among other things.

Participants at the 2018 Abuja international housing show say the government must look at the funding issues among other impediments to affordable housing.

The Abuja international housing show is a forum that brings practitioners in the housing and construction industry together to exchange ideas and proffer solutions to housing problems in Nigeria.

This year’s show focuses on driving growth and sustainability in Nigeria housing and mortgage markets through improving structures and policies for impact.

AIT

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