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Housing Crisis and the Need to Review National Housing Fund Bill

The National Housing Fund (Establishment Act) 2018 is a bill to repeal the NHF Act 1992 (now NHF Act Cap N45, LFN 2004).

The bill, sponsored by Senator Ahmed Lawan, has the primary aim of mobilizing additional funding for the financing of housing projects in Nigeria just as is the case with the NHF Act 1992.

 

The major highlights of the bill are as follows:

  1. A levy of 2.5% (ex-factory price) on each bag of locally produced and imported cement.
  2. Contribution of 2.5% of monthly income on all employees (Public and Private Sector) at an interest rate of 2% p.a.
  3. Contribution of 2.5% of self-employed earning the equivalent of minimum wage and above at an interest rate of 2% p.a.
  4. Investment of 10% of Profit before Tax (PBT) of every commercial bank, merchant bank, insurance company and PFA in the fund at the rate of 1% above interest rate payable on current accounts by banks.
  5. The FGN shall make “adequate financial contribution and grants” to the fund as it deem fit. No amount was specified.
  6. An employer (public and private) is expected to make the monthly deductions and remit to the fund through the Federal Mortgage Bank (FMBN).
  7. The Central Bank of Nigeria (CBN) shall collect the investment amounts from Commercial and Merchant banks at the end of each year, the National Insurance Commission (NAICOM) shall collect for insurance companies, the National Pension Commission (PENCOM) has the responsibility to collect for PFA’s; while the Federal Inland Revenue Service (FIRS) will collect from manufacturers and importers the 2.5% levy on cement.
  8. There are sanctions for individuals or body corporate who fails to collect and remit contribution & levies ranging from losing operating licenses to fines up to N100 million for corporates and N10 million for individuals.
  9. Any contributor who does not have any outstanding loans and has attained 60 years of age or 35 years of service is entitled to a refund of contribution at an interest rate of 2% p.a. with 3 months of application.

Who manages the fund?

The Federal Mortgage Bank of Nigeria

How?

Through lending to Primary Mortgage banks (PMBs)

Who can access the loan?

Individual Contributors and Developers

How do contributors access the fund and is it limited to contribution?

A contributor interested in obtaining the NHF loan applies through a registered and duly accredited Mortgage Loan Originator (PMB), who packages and forwards the application to the FMBN. The loan amount is determined by the applicant’s affordability and not the 2.5% of income contributed.

Is participation Compulsory?

Yes it is mandatory for everybody earning any amount from minimum wage and above. Whether you are a public worker, a private worker or self-employed; as long as you are earning any amount from minimum wage, you’re mandated to contribute.

What is the difference between the NHF Act 2004 and the NHF Bill 2018?

 What is the difference between the NHF Act 2004 and the NHF Bill 2018?
The  NHF scheme was set up by the NHF Act No.3 of 1992, to provide a pool of fund that will cater to the housing needs of the low and medium income earners, and it was mandatory for employees to contribute 2.5% of their monthly income to benefit from it.

 

NHF 1992

NHF 2018

Contribution
by Nigerian workers

An employee or self-employed earning an income of N3,000 and
above per annum in both the public and the private sectors shall contribute
2.5% of his basic monthly salary to the Fund at an interest rate of 4% on
contributions

An employee or self-employed earning minimum wage and above per
annum in both the public and the private sectors of the economy shall
contribute 2.5% of monthly income to the Fund. At an interest of 2% on
contributions

Contribution
by Body corporate

Every commercial or merchant bank shall invest in the Fund 10%
of its loans and advances at an interest rate of 1% above the interest rate
payable on current accounts by banks.

Every commercial or merchant bank shall invest in the Fund 10%
of PBT at an interest rate of 1% above the interest rate payable on current
accounts by banks.

Every registered insurance company shall invest a minimum of 20%
of its non-life funds and 40% of its life funds in real property development
of which not less than 50% shall be paid into the Fund at the rate of 4% p.a.

Every Insurance Company, shall invest in the Fund 10% of PBT at
an interest rate of 1% above the interest rate payable on current accounts by
banks.

No Investment from PFAs (Note: There was no PFA
then
)

Every PFA shall invest in the Fund, 10% of PBT at an interest
rate of 1% above the interest rate payable on current accounts by banks.

No Levy for any manufacturer or importer of cement

Every manufacturer or importer of cement shall remit 2.5% o
cement price.

Refund to
a contributor

Any contributor who does not have any outstanding loans and has
attained 60 years of age is entitled to a refund of contribution.

Any contributor who does not have any outstanding loans and has
attained 60 years of age or 35 years of service is entitled to a refund of
contribution at an interest rate of 2% p.a. with 3 months of application.

Penalty

Sanctions for individuals or body corporate who fails to collect
and remit contribution and levies ranging from fines up to N50,000 for
corporates and N5,000 for individuals.

Sanctions for individuals or body corporate who fails to collect
and remit contribution and levies ranging from losing operating licenses to
fines up to N100m for corporates and N10m for individuals.

Source: Yinka Ogunnubi Research / #NHF2018

 

If the NHF Act has been in existence since 1992 and the provisions of the law was mandatory how come it was not fully implemented?

 

The NHF scheme was set up by the NHF Act No.3 of 1992, to provide a pool of fund that will cater to the housing needs of the low and medium income earners, and it was mandatory for employees to contribute 2.5% of their monthly income to benefit from it.

However, there were several reasons why the scheme was never fully implemented, viz:

 

1. Stakeholders did not meet up to their obligations. As recent as 2013, the CBN had not even paid up its 30% equity stake in FMBN. Banks and insurance companies that were required to be investing in the scheme were also defaulting. Even the CBN and the insurance commission that was required by law to remit investments of these financial institutions couldn’t be bothered about implementing the law.

2. Many States didn’t start remitting until many years after the law came into effect. Even when they started remitting, they were defaulting. Some States have huge gaps as in number of years when they stopped and started remitting again. As at 2009, only twenty-four (24) States were contributing to the fund. It is difficult to enforce a law which even the drafters (government) were not obeying.

3. Many employees through their Labour unions opted out of the scheme due largely to complaints regarding alleged poor record keeping by the Federal Mortgage Bank of Nigeria (FMBN) and cumbersome bureaucratic bottlenecks.

4. The cost of construction and real estate development kept increasing beyond what the capacity of workers could afford. The maximum loan amount collectable on the NHF presently is N15 Million with equity contribution ranging from 10% – 30% depending on the amount applied for.

5. Challenges in enforcement of the law. For instance, the law hasn’t been able to figure out how to get the self-employed to contribute. The law expects them to voluntarily contribute. Never going to happen in a million years. Besides, it’s difficult to enforce a law that the enforcers themselves are breaking.

6. Finance. The pool of funds was insufficient to make any significant impact. Between 1992 – 2009 (a period of 17 years), the fund was only able to mobilize about N70 Billion of which it was able to loan out about N20 Billion mostly to developers.

7.The Land Use Act made the process of perfecting title to landed property burdensome, slow and costly. The NHF does not fund purchase of land. It only funds construction and renovation of buildings of which you MUST have title documents proving ownership to be qualified for the loan. This was a cul-de-sac scenario – a route or course leading nowhere.

8.Political considerations: The States were more inclined to implement their housing projects rather than contribute to the NHF because such projects had greater political gain to them than the NHF which is seen as a Federal Government institution and the means/arm through which the Federal government executes its own housing projects (political mandates/promises). Any accomplishment of the FMBN was therefore seen as a certain credit to the Federal Government rather than the State Government or Governor’s achievement.

“Without abrogating the land use act, housing can never become affordable in a million years in Nigeria. Freehold property rights is a pre requisite for accessing affordable 30yr mortgages which is necessary for cheap housing” – Kola Ibrahim‏ @alpontif

 

What has the NHF achieved since inception?

According to the Federal Mortgage Bank of Nigeria (FMBN) Managing Director, Ahmed Dangiwa, the NHF since inception (i.e. 27 years ago), has disbursed a total of N193.4 Billion in loans to about 23,000 beneficiaries and made refunds to about 230,000 retirees.

While a significant part of the fund has been accessed by developers resulting in thousands of housing units constructed, it must also be noted that the fund has been most active in recent years due to increased collaborations with Labour, States and the Organised Private Sector (OPS).

Challenges of the NHF 2018 Recently Passed by NASS

PriceWaterhouseCoopers (PwC) recently posted ten (10) reasons why the bill in its present form is a bad idea. Permit me to highlight seven (7) of them for specific reference.

  1. The contribution is regressive as it taxes the poor more than the rich. For instance, minimum wage earners will pay about 250% of their personal income tax (PAYE) to the NHF monthly.
  2.  Making all employers liable to deduct and remit the contributions monthly (without a threshold) will worsen the ease of doing business and Nigeria’s paying taxes ranking;
  3. Cost of borrowing will increase as banks are required to invest a minimum of 10% of their profits at 1% above current deposit rates;
  4. Increasing the tax burden without addressing other fundamental issues like land regulation, REITS framework etc is not consistent with the 2017 National Tax Policy;
  5. Imposition of the 2.5% levy on cement is a tax on property development which will make housing even less affordable;
  6. The requirement for PFAs to invest pension funds in the scheme means less returns for pension contributors which will erode value for pensioners; and
  7. The return of 2% per annum for contributors withdrawing after attaining 60 years of age or 35 years of service is far below inflation rate and grossly insufficient to compensate for time value of money.

Conclusion

This bill (as is) is clearly an attempt by the National Assembly to mobilize more funding for the NHF which in 27 years has not been able to mobilize much in terms of finance. That is clearly understood.

However, the challenges of housing, goes beyond just funding. First, there are systemic challenges around property rights for example that needs to be resolved. If this is not fixed, contributors cannot access loans and the funds will just be another big government effort to trap people’s money until they retire or worse die.

Secondly, I am of the opinion that perhaps the emphasis should be more about ensuring that banks and insurance companies comply with the law as it currently is rather than enacting another law that will most likely be defaulted. For instance, the Central Bank of Nigeria (CBN), and the NAICOM statistics indicated that between 2008 and 2017, total loans and advances by deposit money banks and non-life and life funds from insurance companies amounted to over N100 trillion.

At 10% investment of their loan advances and non-life and life insurance with the NHF, about N10 trillion should have been invested in the fund by the banks and insurance companies over the period. Can we strive to achieve this first before increasing the burden of contribution on workers?

It is telling that the fund has refunded more to retirees than it has actually granted loans to contributors.

Without an integrated solution, plan and strategy in place, (which must also include increased funding), we would simply be increasingly the burden on workers.

In trying to solve one problem (the lack of adequate funding), we should not in the process create additional problems for the Nigeria worker and corporate entities (the cobra effect).

This bill, in my opinion, should not be signed into law in its present form. The President should send it back to the NASS for further review and more stakeholders input to deliver on the practical objective

By Yinka Ogunnubi

Africa’s Poverty Crisis May Worsen in 2030, World Bank, IMF Warn

Unless urgent rescue plans are employed, nine of every 10 African nations would be living in abject poverty, the World Bank has warned.

Paradoxically, the same year is the global financial institution’s target for ending extreme poverty worldwide.

The development, that is already giving World Bank President, David Malpass, concerns was given by the global lender and its sister agency, the International Monetary Fund (IMF) in Washington at separate press briefings by heads of the two Breton Woods institutions at the ongoing 2019 Springs Meetings where solutions to global growth challenges are being sought with growth forecast already readjusted backwards globally.

World Bank

Malpass and IMF’s Christine Lagarde both said curbing corruption through public expenditure and transparency and accountability in local resource mobilisation rather than attraction of more debts, which they both believe constitute the greatest headwinds, was key to averting the doomsday.

READ ALSO: NIGERIA NEEDS GROWTH TO DEFUSE POVERTY TIME BOMB

For Malpass, the deceleration was seen in both advanced and developing economies, and it coincided with three other warning signs: waning structural reforms in major economies; financial stress in some large emerging markets; and elevated policy uncertainty worldwide.

Source: By Mathias Okwe.

Family Home Funds and the Plausible Goal of Affordable Housing in Nigeria

With nearly 200 million people, Nigeria has the largest population in Africa, and it is the 7th in world population ranking. In spite of this huge population, the country has struggled over decades to come up with a sustainable action plan that will reduce the incredible housing gap in the country.

Governments in many countries take the responsibility for the provision of housing through a mortgage financing system that simplifies home ownership for employed citizens, and a social security system for the unemployed. And this is why China with a population of 1.3 billion people has a housing surplus yet Nigeria with a population of about 200 million has a housing deficit.

According to multiple housing surveys conducted since 2011, there is over 20 million housing deficit in Nigeria. Generally, housing has been a major challenge in Nigeria for decades and there seems to be a preponderance of ineffective or motionless housing policies that has led to the inability of government to address the housing challenge.

In 1991 the government of Ibrahim Babangida promulgated the National Housing Policy, which was aimed at making housing affordable for Nigerians. As a result of the ineffectiveness of the policy in completely addressing the issues, a committee was set up in 2001 to provide a new housing policy. The report of the committee culminated in the New National Housing Policy of 2006. Yet, that policy despite the breadth of its input did not solve Nigeria’s housing challenges.

READ MORE: US MORTGAGE APPLICATIONS HIT TWO AND A HALF YEAR HIGH

In 2012 the then Minister of Housing, Dr. Ama Pepple presented a new draft policy on housing to the Federal Executive Council. The policy sought to initiate a new paradigm to the existing housing policy.

The new policy proposed the collaboration between federal government and the private sector in the provision of one million houses annually in order to address the housing deficit of the country. In other words, the new policy sought to promote Public-Private-Partnership in housing for all Nigerians.

family

Although, the new direction encouraged the participation of the private sector in the housing sector, not much was implemented before the expiration of the Jonathan’s administration.

A New Direction with Family Home Funds

It is against this backdrop that the current administration under the leadership President Muhammadu Buhari and the Minister of Works, Power and Housing, Babatunde Fashola introduced new policy measures to address the housing challenges in the country.

The Family Homes Fund Limited is one of such new initiatives. The Fund is a partnership between the Federal Ministry of Finance and the Nigerian Sovereign Investment Authority as founding shareholders.

The Fund is the largest affordable housing-focused fund in Sub-Sahara Africa, leveraging its significant capital (in excess of N1trn by 2023) to facilitate access to affordable housing for millions of Nigerians on low to medium income groups.

Through strategic partnerships with various players in the sector and some of the world’s main Development Finance Institutions, the Fund has an ambitious commitment to facilitate and supply 500,000 homes and 1.5million jobs for the low income earners by 2023.

Beneficiaries of the project will enjoy a deferred loan for up to 40% of the cost of their home. For the first 5 years of the loan, no payments need to be made. From the 6th year, monthly payments will be made to start repaying both interest and capital to assist the purchaser.

The amount paid starts low and increases each year in gradual steps (average 6.5% per annum) in order for the HTB loan to be fully repaid by the 20th year, the same year the mortgage is expected to be fully repaid. To qualify, households will have earnings between N600k to N1.2m per annum and the new home must cost less than N7.5m.

family

An exception is made in Abuja, Lagos, Port Harcourt and Kano where the cost of a new home can be as high as N9m. Households benefiting from Loan Assistance will not be owners of a suitable home and will include one income earner who is under 35 years of age and does not have to be one of the people applying for the scheme or the loan but must be available to help with repayments.

The fund has recently completed the construction of 400 homes with an average cost of N3.5million in Grand Luvu, Nasarawa State – part of over 4,000 homes under construction in five states namely Ogun, Nasarawa, Kano, Delta and Kaduna.

A further 30,000 homes have been negotiated with development partners and have commenced since November 2018.

READ MORE: SCIENCE TECH TO BOOST NIGERIAS GDP MINISTER

As the new company builds capacity through the ongoing recruitment campaign, it will achieve a program of 80,000 homes by December 2019.

family

 

FHF and Creation of New Jobs

Ongoing investments are already making a real difference with over 13,000 jobs created and about 360,000 to be created from current development pipeline. The Grand Luvu Project in Nasarawa State has created about 8000 jobs.

Many young people, especially those who were previously unemployed have been able to obtain training on the Funds Grand Luvu project, acquire valuable skills with guaranteed long-term employment and income to support their families. Same goes for the unskilled unemployed youths who depend on their family until they were employed as masons or carpenters on the project sites.

In Kaduna, the Millennium City project has directly engaged slightly over 200 persons which includes local artisans including carpenters and brick layers. The construction need for accountants, surveyors, engineers, etc. has created a lot of jobs since commencement.

According to officials of the fund “Our focus is to create homes that people, particularly those on low income can afford but beyond that, ensure that we provide opportunity for them to earn decent wages consistently through our investment in these projects.

“We have spent the last year building very strong foundations for a major take off and now we should start seeing the results in affordable homes and jobs for local people.”

 

Sustaining the Tempo

A noticeable pattern over the decades in such housing projects in Nigeria has been the counterproductive interference of politics, bureaucracy and corruption. Given the current level of performance by the Family Home Funds, and with credible projections for greater success, the wheels can only slow down if the government allows the intrusion of intervening variables that have always shortened the lifespan of housing development.

Government should ensure that its quality control officers are incorruptible and cooperative with the project leaders at Family Home Funds for the sake of harmony and the deliverance of testable results.

The current government has shown a commitment to fighting corruption, and it is the hope of many, especially Nigerians who will benefit from this project that corrupt civil servants and politicians do not have opportunities to exert themselves and their vested interest against the will of the people.

Obviously, Family Home Funds possess the technical and logistic abilities to deliver these projects, it is therefore very important for the government to ensure credible partnership.

 family

Family Home Fund’s Deserved Accolade

For Nigerians who had totally given up hope of ever owning a home of their own, especially because of cost, this is definitely a new era of hope. Times are changing and homes are being built, just as jobs are being created.

Many Nigerians on low income have always been unable to buy a home either because they do not have sufficient savings for a deposit or are unable to meet requirements for a mortgage. The Family Homes Funds intends to set up a Rental Housing Fund to give Nigerians on low income a first step on the housing ladder. When the Fund is launched, eligible beneficiaries will be able to lease a decent home for a monthly cost not exceeding 40% of their household income including an option to buy the home at any anytime.

It is the expectation of many that Family Home Funds do not fail Nigerians. If Nigeria must close its housing gap and catch up with other countries, then Family Home Funds has brought a timely intervention that must be sustained with utmost commitment.

By Ojonugwa Felix Ugboja

Commercial real estate and multifamily lenders set new record

Commercial and multifamily lenders had another banner year in 2018, when closed-loan originations rose 8% to a high of $574 billion.

“Borrowing and lending backed by commercial and multifamily properties hit another new record last year,” Jamie Woodwell, vice president of commercial real estate research at the Mortgage Bankers Association, said in a press release.

“Solid fundamentals, growing property values, low interest rates and strong appetites from both borrowers and lenders all helped drive an 8% increase in recorded multifamily lending from a year ago. Repeat participants in our survey increased their lending by 4% during 2018, with the remaining growth coming from the addition of new firms.”

Commercial bank portfolios provided the most capital to the market, representing $174 billion or nearly one-third of the total. Government-sponsored enterprises Fannie Mae and Freddie Mac were responsible for more than $142 billion or nearly one-fourth of the total.

Digital mortgages”Many capital sources rose to record levels of lending — including bank portfolios, life insurance companies and the GSEs,” Woodwell said. “Among property types, multifamily pulled even further ahead as the dominant lending target, growing to 46% of total mortgage banker lending — a series high.”

Office was the next largest property type after multifamily, representing 18% of the total. Retail, hotel/motel and industrial property types each represented 8% of the market for a combined 24% market share. Health care loans represented 2% of the market.

The previous record for commercial real estate and multifamily loans closed in a year was $530 billion, according to the MBA.

Source: Bonnie Sinnock, National Mortgage News

African Development Bank approves $15 million investment package for Infrastructure Credit Guarantee Company

The Board of the African Development Bank has approved a $15-million investment package to Infrastructure Credit Guarantee Company (InfraCredit), to support infrastructure financing through the domestic debt capital markets in Nigeria.

The investment package to InfraCredit is comprised of a subordinated loan of $10 million and a risk sharing facility of up to $5 million. This intervention will promote local currency infrastructure financing, and further development of the domestic capital market.

InfraCredit is a specialized infrastructure credit guarantee company, established to enhance local currency debt instruments – mainly bonds, to finance eligible infrastructure projects in Nigeria. This is intended to uplift the credit rating of such bonds, allowing institutional investors to include them in their portfolios.

African Development Bank

InfraCredit was founded by the Nigerian Sovereign Investment Authority (NSIA) in collaboration with GuarantCo (part of the Private Infrastructure Development Group). These initial investors have been joined by the Africa Finance Corporation (AFC) and KfW, the German Development Bank.

The African Development Bank’s investment in InfraCredit will catalyze local institutional investor funds, including pension funds, into financing long-term infrastructure projects through the local bond markets. The investment boosts InfraCredit’s qualifying capital base through the subordinated loan; it also improves its capacity to expand its guarantee business through the proposed risk sharing arrangement.

READ ALSO: THESE ARE THE TOP US COMMERCIAL MULTIFAMILY MORTGAGE ORIGINATORS

Through this intervention, the African Development Bank is helping to stimulate local currency financing across diverse infrastructure transactions, thereby improving economic diversification and competitiveness, as well as promoting more equitable growth, strengthening local value chains and financial markets in Nigeria. InfraCredit’s operations will catalyze infrastructure investments in critical sectors such as renewable energy, housing, transportation, agricultural infrastructure, and telecommunications, which are critical for the country’s economic development. These also align with the Bank’s High 5 agenda.

African Development Bank

Stefan Nalletamby, the Bank’s Director of the Financial Sector Development said, “The Bank’s support will strengthen the capital base of InfraCredit, underpinning the expansion of the Company’s core business of guaranteeing of bonds issued to fund infrastructure projects. This adds to the Bank’s existing initiatives to mobilize domestic institutional savings and stimulate non-sovereign local debt capital market development in Nigeria. This ultimately helps to increase private sector financing for critical infrastructure projects in key sectors including energy, agriculture, water, health and education, through local capital markets”.

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The transaction will also result in the leverage and enhancement of the scope and impact of the Bank’s interventions alongside private sector financing, especially from pension funds as well as from co-investment partners. InfraCredit aims to support up to $1.25 billion in infrastructure financing over the next few years, by involving the private sector in infrastructure financing, essential to Nigeria’s economic resilience.

Source: AFDB.ORG

Over 200 CEOs to Attend AIHS CEO Forum in July

Nigeria’s premier and most established housing show, The Abuja International Housing Show (AIHS), is set to host over 200 Chief Executive Officers (CEOs) from varied companies and firms in the housing, construction and business industries across Africa and the world in July.

It will be the biggest convergence of such important figures sharing ideas, experience and expertise on how to lead a more effective and financially inclusive industry.

Registration for the 13th edition of the show which will hold this year from 23 July to 26 July has commenced and according to the event’s coordinator, Festus Adebayo, this edition will feature a CEO Forum on the first day (23 July) to tackle several challenges, especially the recurrent ones in the housing sector.

According to Adebayo, over 200 CEOs in the real estate, mortgage housing finance, construction companies and professional institutions will focus on macro-economic and socio-political environment and impact of real estate market.

“The forum which is a gathering of high profile professionals who are founders and business owners will give opportunity to present and discuss challenges facing their respective organisations and the way forward.

“It is a collaborative and supportive environment for leaders in Nigerian real estate industry support services and mortgage banks. Participating in the forum will increase high level business contact.’’

According to Adebayo, the forum will equally provide avenue for meeting counterparts from every parts of the country and outside the country on networking business relations.

With an ever changing world, it is indeed very timely to have all these top leaders converge for the sake of advancement. Various ideas and experiences from several places will greatly benefit the participants in forging more adaptable and effective models of operation.

 

Cross-fertilization of Information

The attending CEOs will proactively engage the show with first hand, authentic – not to mention relevant – information on a number of issues pertaining to the industry.

The most potent resource of the 21st century and especially in the Housing and Construction Sector is information. Things change quickly, and only those who can keep up will be able to compete and stay relevant in the industry.

Having access to veritable information has always been one of the most important benefits for stakeholders who attend the AIHS.

A major highlight of the event is the showcase of innovative developments in the housing industry, paper presentations from experts and leading names in the industry.

In addition, renowned experts will provide housing market forecasts and examine issues such as employment, home prices, production, demand and supply.

CEO Roundtables

There will be break-out sessions led by the attending CEOs to address emerging issues during the course of the show with some definitive and specialised solutions. This will be of great benefit for the entire industry as such recommendations will be largely adopted in order to effectively grapple with industry challenges ranging from the provision of affordable housing, mortgage, quality control and policy directions.

READ ALSO: HOUSING SHOW TO DRIVE FINANCE MODELS – CONVENER

The CEO forum will also be an opportunity for the promotion of new ideas, innovations and products looking for markets. It will also serve as a selection ground for those looking for ideas, businesses and products to invest in.

Clearly, there is no other platform in Nigeria that can bring together as many professionals, not only from housing, real estate and construction sectors, but also from government, investment, and capital markets to share their first-hand experience, knowledge and expertise on varied issues related directly or indirectly to housing and development.

For registration CLICK HERE

Hispanics Lead Recent Homeownership Surge in U.S

The National Association of Hispanic Real Estate Professionals released the 2018 State of Hispanic Homeownership Report on Tuesday at its Housing Policy & Hispanic Lending Conference.

The annual report found that from 2008 to 2018, the Hispanic population was responsible for 81% of U.S. labor force growth, accounted for 39.6% of U.S. household formations and represented 62.7% of the increase in U.S. net homeownership.

“The annual State of Hispanic Homeownership Report play an important role in noting important trends in the Latino megamarket and serves as a key informational resource for policymakers and industry stakeholders,” NAHREP said in a press release.

The 2018 State of Hispanic Homeownership Report is in its ninth year of publication, focusing on the impact of language and culture in home purchase transactions. In addition to statistics on these homeownership trends, the report also provides recommendations on marketing strategies to help companies effectively reach Hispanic consumers.

Download the full report here.

Source: By Alyssa Stringer

IMF again tasks Nigeria on removal of $5.2trn fuel subsidy

The International Monetary Fund (IMF) on Thursday insisted that Nigeria should remove its fuel subsidy, which it said has accumulated to the tune of $5.2 trillion since 2015.

The Washington-based Fund recommended the creation of a social protection safety net so that the most exposed in the population do not take the brunt of the removal of the subsidy.

“We believe that removing fossil fuel subsidies is the right way to go. If you look at our numbers from 2015, it is no less than about $5.2 trillion that is spent on fuel subsidies and the consequences thereof,” Christine Lagarde, IMF managing director, said during a press conference at the ongoing 2019 World Bank/IMF Spring meetings in Washington DC.

If the subsidy removal happens, she said there would be more public spending available to build hospitals, roads, schools, and to support education and health for the people.

She said the Fiscal Affairs Department has actually identified how much would have been saved fiscally but also in terms of human life if there had been the right price on carbon emission as of 2015.

“The numbers are quite staggering,” she added.

Lagarde advised the Nigerian government to make real effort to maintain a good public finance situation for the country in order to direct investment towards health, education, and infrastructure.

“I would add as a footnote as far as Nigeria is concerned that, with the low revenue mobilisation that exists in the country in terms of tax to GDP, Nigeria is amongst the lowest,” she said.

On the global scene, Lagarde said the global economy is currently quite uncertain and that as at a year ago, 75 percent of the global economy was going through the phase of synchronised growth.

“As you heard a couple of days ago, we are now talking about a synchronised slowdown by 70 percent of the global economy. So our forecast for growth this year is 3.3 percent, going back up we hope in 2020, based on our forecast, to 3.6 percent,” she said.

This expected rebound from 3.3 percent in 2019 to 3.6 percent in 2020, she said, is precarious and subject to downside risks, ranging from unresolved trade tensions, yet high debt in some sectors and countries, both public and corporate, to the risk of weaker-than-expected growth in some stressed economies.

In terms of policy recommendations, about this moment of uncertainty and precarious possible pickup, Lagarde suggested not a single policy but multiple policies because it will have to be country-specific as there is no one-size-fits-all.

“But we certainly would recommend two key principles. One is, do no harm. Second, do the right thing. So do no harm. The key is to avoid the wrong policies, and this is especially the case for trade,” the IMF managing director said.

The Fund urged countries to create more room in order to resist the next crisis when the downturn comes and that means enhancing resilience by making smarter use of fiscal policy and by strengthening financial sector policies and discipline.

“And in all of these efforts, we need stronger international cooperation. We need those policymakers that I would call the women and the men for all seasons in order to resist that uncertainty that we have at the moment,” she said.

Regarding the Africa and China debt issue, Lagarde said the World Bank and the IMF are working together in order to bring about more transparency and be better able to identify debt out there.

“We are constantly encouraging both borrowers and lenders to align as much as possible with the debt principles that have been approved by the G20 and that we have endorsed internally and developed ourselves.

“It is clear that any debt restructuring programmes going forward in the years to come will be more complicated than debt restructuring programmes that were conducted 10 years ago simply because of the multiplicity of lenders and the fact that not all public debt is offered by members of the Paris Club, for instance, which does not mean to say that any debt from a lender outside the Paris Club is an issue as long as the principal principles are adhered to,” Lagarde said.

Source By:Hope Moses-Ashike & Onyinye Nwachukwu

The Required Documents for Land Purchase in Nigeria

There are always documents involved in every business transaction carried out especially the ones involving money. Real estate transactions are no different. These documents serve as proof that a business transaction took place. The most common business document is a receipt which indicates that money was paid into an account or paid to someone. These documents secure one’s investments and make it possible to plead a case peradventure there is any dispute.

The nature of land disputes in Nigeria makes it extremely important that you have all relevant documents regarding ownership of a land or property. These titled documents are recognized by various government statues and laws on land and landed properties.

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Having all the documents required for a land purchase will help make your ownership legitimate after proper verification from the appropriate government agencies in charge of all land and land related issues in Nigeria.

Here are the documents required to make a land purchase in Nigeria:

Deed of assignment

The deed of assignment is the document that shows that you are the new owner of the land. It is always worrisome to see people buy land and not ask for this document. It is a very important document that you should of a necessity request that it be given to you at the end of the land or property transaction.

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It is often time referred to as deed of conveyance however conveyance refers to the process where the seller transfers ownership of the land or property to the buyer. It is a mutual agreement between the owner of the land and the buyer. While the deed of assignment is a signed agreement where an assignor (Seller or owner) states his consent that from the date of the assignment (purchase) or any date stipulated therein, he assigns his ownership of that Land to the assignee (buyer).

The deed of assignment contains some very crucial information for a land/property transaction. Such as the date the ownership was transferred to the assignee and a clear description of the property or land.

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Once you have the deed of assignment it is very mandatory that you go record it at the appropriate land registry to serve as legal evidence to the real estate transaction. At the land registry, the deed of assignment will then be stamped at the stamp duties office before it becomes authenticated in the form of a governor’s consent or registered conveyance.

 

Survey plan

This is a document that clearly delineates the boundaries, the length and breadth of the property or land purchased. It gives accurate measurements and description of that land. It also helps to reveal if the land is under Government’s acquisition or not or whether the land is in a Government acquired or committed area.

Simply put, with a survey plan, you’ll be able to know everything about the land. It is important you request for this document BEFORE you buy the land. Request that a copy be given you so you can take it to a surveyor to help you cross check the document as well as confirm that what’s on paper is the same thing on land.

The survey plan would also help you know the purposes for the land, whether it is for residential, agricultural or commercial purposes.

A survey plan should have the following:

The name of the owner of the land surveyed.

The Address or description of the land surveyed.

The size of the land surveyed.

The drawn out portion of the land survey and mapped out on the survey plan document.

The beacon numbers.

The surveyor who drew up the survey plan and the date it was drawn up.

A stamp showing the land is either free from Government acquisition or not

With the survey plan, you can do a proper land search and know about everything concerning the parcel of land. ALWAYS request for a survey plan BEFORE you make a purchase.

 

Certificate of occupancy

This document certifies the legal ownership status of any property or land in Nigeria. It signifies that the owner of the property has been given legal permission to occupy the property by the executive governor of that state.

A certificate of occupancy is given to owners of lands or properties situated in urban areas, if the property is situated in a rural area; a customary right of occupancy is given by the local government council.

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A certificate of occupancy is a land title document issued by the government validating the owner’s right to ownership of a parcel of land for a period of 99 years. However, some lands or properties for sale already come with a C of O, in that Case, Endeavour to ask for it. If your land or property does not come with a C of O, ensure you get one.

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Receipt

This is a document that proves money was exchanged in the real estate transaction. Without this document, there is no way one can proof that money was involved. It shows that the seller acknowledges that he or she received payment for the land or property.

People often make a big mistake of thinking a deed of assignment is the same as a receipt. They are NOT the same. A receipt validates monetary payment while a deed of assignment validates ownership.

A real estate purchase that does not have receipt as evidence of transaction becomes untraceable in times of problem. No one is wishing evil to anyone but then these things do happen, that’s why it’s best you have all relevant document regarding the purchase of a land/property.

A bank cheque or draft is still one of the best payment methods, and you should have someone witness the transactions. If you want to carry out cash transactions, ensure you are given a receipt right there and then, else, your payment would not hold water.

You are strongly advised to get all these documents in hand so you can easily avoid and get out of all and any problems regarding land ownership in the country. Always remember to get professional real estate advice from trusted real estate consultants like FESADEB Ltd before putting in your money into any real estate investment.

Source: Housingnews

REDAN President, Ugo Chime, Reveals Why 2019 Expo Will Be Best Ever

In an interview granted Housing News, the President of Real Estate Developers Association of Nigeria (REDAN), Rev Ugo Chime (UC), reveals why this year’s Expo will be the most improved and anticipated.

Q. Can we meet you Sir?

UC. My name is Reverend Ugo Chime. I am the President of Real Estate Developers Association of Nigeria, REDAN Expo 2019.

Q. Can You Tell Us About REDAN and the Expo?

UC. REDAN is an umbrella body of all real estate developers in the country. They’re the ones handling the supply side of the housing and construction industry. While people make demands, REDAN supplies. The REDAN Building Expo is coming up on 7th to 8th May 2019. This year’s theme is, ‘’REAL ESTATE DEVELOPERS: THE BEDROCK FOR NATIONAL ECONOMIC STABILITY.” The REDAN 2019 Expo is the third edition and it is aimed among other things to bring to floor the professional developers in the real estate and housing industry, and discuss how best they can serve as a catalyst in the development of the Nigeria economy.

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Q. Where is the Venue of the Event?

UC. The Expo is holding at the Musa Yaradua Center, Abuja.

Q. What Are the Key Activities?

UC. Activities lined up includes mandatory continued professional development for participants; opportunities for the players in the industry to showcase their products; and the programme will also feature exhibition of building materials and corporate presentation of new products. This year’s expo will feature many exhibitions of real estate projects across the country, it will also feature display of new building technologies, innovations in home interiors and design.

Q. Who is the Guest of Honor?

UC. The guest of honor for this year’s REDAN EXPO is no other person than the Minister of Power works and housing, Mr Babatunde Raji Fashola. He will be the one to officially declare open the EXPO on the 7th of May.

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Q. Who are the Speakers at This Year’s Expo?

UC. This year’s lead guest speaker is no other person than Mr. Hakeen Ogunniran, who is the present Managing Director of Exima Realities. He was the former Managing Director of UBDC. Other guest speakers include Mr. Femi Adewole, the chief Executive managing director of family home funds.

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Q. What is the Level of Compliance So Far?

UC. I can confirm to you that many estate developers have already registered for participation and many stakeholders have already confirmed their participation. So this year’s REDAN EXPO is going to be greater and better than the previous ones. In that line, we are calling all stakeholders to register for the REDAN EXPO before it is too late. Everything has been going based on strict schedule.

Q. What are the benefits of attending this Expo?

UC. The 2019 REDAN Expo will create an unparalleled network opportunity for stakeholders who will be participating; it will be an avenue for stakeholders and other members who are looking for opportunities to relate with Family Homes Fund — a new establishment of federal government, to meet with the MD and get to know how they can benefit from Family Homes fund.

For the first time, REDAN is collaborating with CBN and six other agencies which will be launching Real Estate Data at the opening ceremony. This year’s Expo will also be attended by all the Chief Executives from Federal Mortgage Banks in Nigeria, Mortgage Finance, Family Homes Funds and others including the Federal Ministry of power works and housing.

Q. How ready is REDAN to host this Expo?

UC. From the reponses from people, stakeholders and partners I can tell you that REDAN is ready. The necessary logistics have been put in place and all willing participants are encouraged to register in time.

Source: Housingnews

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