Worried by unimpressive growth of the real estate sector in the second half of 2018, housing experts have pushed for immediate passage of 11 housing and mortgage-related bills pending before the National Assembly.
They said if the bills are eventually passed into laws, they would impact positively on the sector by guaranteeing huge local and foreign investments in the housing and mortgage industries. According to Managing Director/ Chief Executive Director, Fesadeb Communications and Promoter of Abuja International Housing Show, Mr. Festus Adebayo, no good investor would invest in the real estate sector that does not have the requisite laws to guarantee investment. New Telegraph findings show that the bills have been before the lawmakers for more than eight years.
While many of the bills have not been read, a few have passed through second reading without further action. These bills are the Land Use Act 1978; National Housing Fund (NHF) Scheme Act 1992; Mortgage Banks Act 1989 (Subsumed in BOFIA); Federal Mortgage Bank of Nigeria (FMBN) Act 1993; the Trustees Investment Act 1962; and the Nigeria Social Insurance Trust Fund (NSITF) Act 1993.
Others are the Insurance Act 2002; Investment and Securities Act 1999; Federal Housing Authority (FHA) Act 1990; Securitization Bill; Foreclosure Law Bills – Residential Mortgage Act and Residential Mortgages (Incentives) Act, among others. Adebayo stated that no effective mortgage system would be possible in the housing sector without reviewing and amending some sections of the Land Use Act of 1978.
He pointed out that without foreclosure law, developers would continue to be at risk of selling via mortgage or on installment payment, hence the need for urgent passage. Many of the experts, through their advocacy platform, “Housing Development Group”, called on Nigerians to join them on a rally on August 18, to ask members of National Assembly to embark on speedy passage of the bills.
The lawmakers are currently on recess and may not return until next month. Corroborating Adebayo, former Managing Director, Lagos State Property Development Corporation, John Bede Anthonio, an architect, said that non-passage of these bills had impeded very much, the development of mortgage and housing for the average Nigerian.
He said that, it would be difficult to attract investments into housing and mortgage sectors without proper regulations. Anthonio said: “If you don’t have laws to govern, how can investors invest in the housing market, which is huge?”
Presently, Nigeria is in shortage of over 17 million housing deficit and would require one million units yearly in the next 20 years to bridge the gap. Some of the challenges to affordable housing provision in the country include difficulty in accessing buildable land, lack of virile secondary mortgage system, weak regulations, high cost of building materials, lack of capacity in modern building technology, high cost of fund and foreclosure laws among others. Despite impressive outlook predicted for the sector in the first quarter of 2018, the industry is performing dismally due to un-synchronized macroeconomic indices.
According to some experts, factors holding down real estate sector are multifaceted, blaming absence of funds, unhealthy politics and victimization of political opponents, among others. Antonio lamented that the sector was being held down by high inflation, double-digit interest, lack of mortgage system and high construction’s cost. Besides, he said scarcity of land, absence of infrastructure, unenlightened public, low purchasing power accommodation seekers and high cost of housing units were also inhibiting factors.
Chairman, HOB Estates Limited, Olusegun Bamgbade, stated that apart from inadequate funding, which he said was a major factor, nepotism in the disbursements of the little available funds by the relevant authorities, has stalled recovery of the sector from slump. For these reasons, Nigeria’s mortgage market has remained in slow growth.