Prepared to tackle housing deficit head-on, the Managing Director of Family Homes Fund (FHF) Limited, Mr. Femi Adewole, said the fund has initiated working relationship with 14 state governments, over 20 developers, four commercial banks and three mortgage banks to enhance home ownership among Nigerians.
Speaking with New Telegraph in Lagos, Adewole said the Fund expected at least 5,000 housing units across five states in the first phase.
He added that more state governments have reached out to the company and that more projects were expected to take off before the end of first quarter of 2019, resulting in additional 6,000 homes across all regions in the country.
The Fund targets 500,000 new homes for Nigerians in five years. Adewole also said that the Fund had concluded arrangement to launch a financing system that would assist low-income group to access finance/mortgages with ease and in a shorter time for home ownership.
On how to ensure that low-income earners have access to housing units, he said: “We are very conscious of the difficulty faced by the low-income group in accessing finance for home purchasing. Consequently, he said FHF will soon launch a financing system that will assist them to access mortgages with ease and in a shorter time.
“We also have a series of checks between all partners in the system, which are conducted on buyers to ensure that they are in the low-income group,” he said.
“Buyers are also required to sign an undertaking to show that they are first-time home buyers, which will be verified before purchase.” In ensuring that buyers get access to financing, the FHF boss said banks need to give competitive interest rates to ensure that low-income group is not side-lined.
The Family Homes Fund Limited is a partnership between the Federal Ministry of Finance and the Nigerian Sovereign Investment Authority (NSIA) as founding shareholders with aim to address the country’s housing deficit.
The Fund is structured as a Real Estate Investment Trust and is being professionally managed to catalyse funds from the private sector, pension funds, insurance funds, multilateral agencies and impact investors. In 2018, he disclosed that housing units were completed in Luvu-Madaki, Masaka, Nasarawa State, through FHF.
On challenges facing the Fund, Adewole stated that one of the challenges was to ensure that homes being delivered are affordable.
He said: “This implies that our costs should be competitive, and the major cost component is land. This highlights the importance of our partnerships with the state governments.
When the state governments give us land, the total cost of production is reduced by a great degree.” Another challenge, he said was about getting developers to key into the vision of affordable housing and it delivery as scheduled.
“We have been fortunate so far to work with developers who understand this and are committed towards growth in the affordable housing space. We also assign independent project managers who ensure these projects are delivered in good time and are of good quality,” the FHF boss said.
On high cost of building materials, Adewole said he would work with developers who have a huge capacity to develop higher quantum of housing units, so that they could work with economies of scale, thereby reducing material cost per unit. Besides, Adewole said the Fund has developed a working relationship with manufacturers focused on long term, which would enable developers purchase materials at cost-effective rates.
“This is also in line with our focus on local content; which ensures we work with local materials that we can obtain at fair rates,” he said. Family Homes Fund is the largest affordable housing focused fund in Sub-Saharan Africa, leveraging on significant capital (in excess of N1 trillion by 2023) to facilitate access to affordable housing for millions of Nigerians on the low to medium income bracket.
Source: Dayo Ayoyemi