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Experts Laud Review Of National Building Code

Experts in the building and construction industry on Thursday in Lagos lauded the Federal Government’s efforts in reviewing the National Building Code of 2006.

They told the News Agency of Nigeria in Lagos that the review was a good development, describing it as a right direction and synergy for effective housing delivery in the country.

NAN reports that the Federal Government had on Tuesday announced a new National Building Code that would regulate construction with the aim of improving on measures to safeguard lives and property.
Babatunde Fashola, the Minister for Power, Works and Housing, made the announcement at the ministry’s Headquarters in Abuja, while inaugurating members of the Architect Registration Council of Nigeria.

Fashola said: “Given the number of deaths and the risk associated with wrong plans for buildings and other construction projects, it becomes imperative for government to adopt deliberate measures to check the avoidable loss of lives and property, hence the new code.”

The experts said the NBC, as instituted by professional bodies in the construction industry in 2006, was supposed to be reviewed at five years intervals.

According to them, this is the first time it is being reviewed.
Contributing, Chucks Omeife, said that the Federal Government should propose an Executive Bill to the National Assembly for an enabling law/legislation that would enforce the various provisions of the NBC.
Omeife, the President, Chartered Project Management Institute of Nigeria, said that passage of the bill would guarantee orderly and effective building environment.

He said: “In the real sense, it will expand the scope of the code in terms of professionals’ responsibilities, expanding industry issues relating to materials, science and technology.

“The implementation and enforcement of the Code has been the problem and still remains the problem. It is a scenario of a motion without movement.“This government can make the difference by putting in place an enabling legislation to back up the Code.”

Also, Kenneth Nduka, the President, Nigerian Institute of Building, urged stakeholders in the industry to have positive attitude for the expectations of the building code to be realised.

Nduka said that stakeholders should continue to ensure full implementation of the code for a well-regulated and effective operation in the building and construction industry.

He said: “The review and announcement of the new building code is a good development, but stakeholders still expect more.

“The issue of quackery, non-involvement of professionals, poor workmanship, and use of untested/substandard materials and neglect of safety standards on construction sites that lead to building collapse will be checked.”

In his remarks, Fitzgerald Umah, the Chairman, Nigerian Institute of Architects, Lagos chapter, said that the code would promote professionalism in the building industry.

Umah noted that activities and operations of the industry were not properly regulated due to lack of laid down rules.

He said that the enforcement of the building code remained the sure way to penalise any erring professional.

The Eagle Online

SGF Wants Foreign Investors To Address Housing, Energy Challenge

The Secretary to the Government of the Federation, Boss Mustapha, has called on foreign investors willing to do business in Nigeria to help address the 17 million housing deficit and energy distribution in the country.

Mustapha made the call while receiving a consortium of companies from America and South Korea in his office on Thursday in Abuja.

Andrew Uhwe, Director Press Office of the Secretary to the Government of the Federation, made this known in a statement in Abuja on Thursday.

Uhwe quoted the SGF as saying that, investing in the housing and energy sector was crucial because of the rise in the generation among other things.

According to the SGF, Nigeria is fully committed to infrastructural development that would meet the needs of its citizenry.

He assured the investors and international partners of government’s preparedness in welcoming any individual that has genuine interest to do business in the country as there is an enabling environment that such investment would thrive.

He said: “The government will do everything possible to support you where there are constraints in getting approval and acquiring licence from relevant agencies.

“Agencies like Transmission Company of Nigeria, National Electricity Regulatory Commission, Ministry of Power, Works and Housing or Environment that would enable you to carry out your projects in energy.

“We want to invite the whole world to come and invest in Nigeria, as a country and government, we are interested in issuance of any licence and we will treat it with dispatch.

He advised them to do a formal letter that will contain details of the projects and earlier, the leader of the delegation Terey Molelawn, Chairman of Ebonyi Independent Power Project, said they were in the office to seek for government’s support in acquiring licence and in getting gas for the power project.

He said that they were bringing the funding and were determined to assist the Nigerian Nation Petroleum Corporation with pipeline that would connect to the grid.

Molelawn said the entire project would cost 10 billion dollars but the first stage would start with three billion dollars.

The Eagle Online

Osinbajo, Obaseki partner to give Edo life-changing projects

Vice President Yemi Osinbajo and Governor Godwin Obaseki made history yesterday with the inauguration of projects capable of restoring hope in Edo State.

Vice President Yemi Osinbajo runs an office with soft spot for small and medium enterprise. The office also cherishes the magic technology hubs are capable of igniting. It was thus not surprising that it has collaborated with the Edo State government in these areas.

Governor Godwin Obaseki, who has ample experience from the boardroom, horned through years of brokering deals as an investment banker, appears to be on a mission to rebrand governance. And in Osinbajo, he has an ally.

The Vice President yesterday launched the South-South Innovation Hub in Benin and met with Micro, Small and Medium Enterprises (MSMEs). He also was at the Edaiken Market and thereafter performed the groundbreaking of the 1800-unit Emotan Gardens and the Edo Azura Power Plant.

Osinbajo’s collaboration with Edo earlier saw him inaugurating the Edo Chemical and Fertiliser Company Limited, Auchi and doing the groundbreaking of the Benin Industrial Park (BIP).

Some of these projects are in collaboration with the Office of the Vice President. The housing project and the expanded Edo Innovation Cluster, which houses the South-South Innovation Hub, are efforts by the Obaseki administration to reset the local economy for growth and expansion. The Innovation Cluster will train young people on top-of-the-range skills to stimulate a local tech ecosystem. This will empower youths to provide digital solutions to everyday problems.

1,800-unit of housing project

This project is a plus for local manufacturers and low income earners. The Emotan Gardens in Ikpoba Okha Local Government Area of Edo State is remarkable in a lot of ways. It is the first government housing project in Edo State in the last 16 years. The project is being developed through a joint-venture partnership between Edo Development and Property Agency (EDPA) and MIXTA Africa, a private property development company.

EDPA Executive Chairman Isoken Omo said the Gardens would also be the first of kind, given the scale, offerings and class.

Mrs Omo said the project was well planned to provide affordable homes, adding: “We are building affordable houses from bungalows to high-rise buildings with flexible payment plans. We have looked at the housing needs of the people of the state and know exactly what to do.”

Obaseki promised that the state would provide the land for the project and link local makers of building materials in the state to the project to ensure that costs were minimal.

“We want to use the project to develop the supply chain of inputs that are locally produced in the state. This would grow local businesses. We have insisted that raw materials to be used for constructing the 1,800-unit housing, should be sourced locally from industries in the state. This will assist the industries contribute to the growth of the local economy,” Obaseki said.

MIXTA Africa Managing Director Kola Ashiru-Balogun said the first phase of the project which, which commenced with yesterday’s ground-breaking ceremony by the Vice President, would be completed in 12 months.

The different payment plans being considered for the affordable housing project, he said, include a 24-month interest free payment plan, as “MIXTA Africa is discussing with financial institutions to see how arrangements can be made to provide longer tenured financing payment plans.”

The Innovation Cluster of hope

With yesterday inauguration of the hub, Edo has finally caught the tech bug. This collaboration between the Federal and state government will provide youths avenue to develop skills for survival in the digital economy and channel their strength for social good.

The Cluster, which is situated at the Institute of Continuing Education (ICE), in Benin City has been remodeled to meet the requirements of co-working spaces.

Obaseki said the facility “will host over 25 Information and Communication Technology (ICT) companies. These companies will use the facility as innovation hub for different forms of training and certification. Those that will benefit from the facility are both the young and old residents in the state as they will get skills and certification.”

Commissioner for Wealth Creation, Cooperatives and Employment Emmanuel Usoh said the facility was a testament of how public facilities could be transformed for effective use.

Usoh said over 25 technology companies would be accommodated in the hub. They include Google Cisco, Miscrosoft and Oracle. He explained that the Hub would up the skill youths, stimulate tech-focused small businesses and curb human trafficking and illegal migration.

Usoh said, “The hub will offer youths who are interested in travelling abroad for jobs, opportunities to acquire up-to-date skills in technology. The training programme will be as intense as obtainable in similar hubs across the world, as we are partnering with global companies in setting up the facility.

“International certifications will be obtainable at the hub. This will offer youths unique opportunities to discover their talents in the use of technology and improve these skills and promote innovation as the world has become a global village, where technology is key in transforming the society for the better.”

A partnership on MSMEs and Start-ups

Edo has witnessed an increasing focus as a hub for economic opportunities given the state government’s posture, which has promoted growth of Small and Medium Enterprises (MSMEs). With the coming of the Innovation clusters, more start-ups will find expression in the state, with the use of the facilities provided at the innovation hub.

At Hub, the state government, has provided the space and other structures for the hub, while the Federal Government is bringing in some experts to operate at the Southsouth hub. However, there is also a strong partnership between the state government and technology companies, which is likely going to make the facility one of the most equipped to accommodate start-ups in the region.

The commissioner said the Edo Innovation Hub would also accommodate a training facility where small business owners would be trained on how to leverage digital solutions to transform their businesses in line with Obaseki’s vision to create more jobs and wealth for the people.

”Individuals and groups who own small businesses in the state and intend to transform their businesses in line with global standards can acquire innovative skills at the hub,” he said.

President Muhammadu Buhari’s Senior Special Assistant on Industry, Trade and investment Dr. Jumoke Oduwole explained that Edo State is part of the vast business corridor in the Southsouth, which explains its choice for the project.

The happenings in Edo have ended the era where Nigerians were exposed to tokenistic solutions to problems. Edo is taking governance beyond a borehole here, a road there, ill-planned agricultural initiatives and many such schemes. It has focused governance on intervention capable of improving livelihoods and do so much.


Ways to Reduce Construction Cost When Building Your Home

Coming up with an estimate of your total building cost can be a very complex process. It is even worse when you are doing it for the very first time because the slightest between your estimated cost and actual construction cost can cripple the building project.

If a building project fails, it won’t matter if it is a residential property or commercial construction. The role of effective and efficient construction cost management cannot be overemphasized. Below are smart ways to reduce your construction cost when building your house.

Keep Your Design Simple
You don’t need a seer to tell you that customised designs are expensive. If your goal is to reduce your construction cost, it is in your best interest to avoid custom designs.

Let’s break this down – To avoid shooting up your construction cost, you can go for a small floor plan with a rectangular or square layout. This sort of plan will cost you less time and less money to accomplish. You also use fewer materials per unit built-up area and this forces your construction cost down.

If you’re aiming for a minimal cost, consider cutting down on the number of rooms and bathrooms in the house. What this does is that it leaves you with a reduced area, brings your budget for building materials down, thus, reducing your overall construction cost.

Pick Your Location Carefully
Your location is particularly crucial if you want to drive down your construction cost. It is fine to opt for locations that offer affordable land but don’t do this blindly. You will be better off, for instance, if such a location is not just cheap but also has a strong potential to experience development in the future.

No matter how cheap the land is, don’t buy if the level of the plot is lower than the level of the road. The reason for this is that when the level of the plot is lower than the level of the road, you’ll end up spending more money buying materials to fill the land. This drives up your construction cost. Plots of land that are the same level as the road are the best

Use the Same Flooring and Painting Materials
When you buy in bulk, you spend less on construction and this is precisely why you should use the same painting and flooring materials across the entire house. This will also allow you optimise on labour input.

For example, instead of buying 5 different colours of paint, which have varying cost, you can pick two colours and buy them in bulk. Consider going for weather-coat paints for outer parts of the house. This is because it decreases your maintenance cost. The same should apply to your flooring materials.

Consider Precast Technology
If you are handling a huge project, which for instance, entails erecting over 100 bungalows, then you can opt for precast slabs. These slabs are manufactured and transported to the site of the house where they are then assembled.

The precast slabs are used as walls during construction. If you are not handling a big construction project, don’t opt for this.

Building Materials
The closer your site is to the point where you would be getting most of your materials from, the lower you will end up spending. You can’t have a plot of land in Badagry and decide to buy your building materials from Ibadan. The financial implication of such a choice can throw a clog in your wheel of progress.

Studies have shown that sites that are not far from the point of gathering materials can cut your construction cost by 15%. Remember that your building materials don’t have to be expensive and branded. Rely on the advice of trusted experts.

Visit Construction Site
You should not stay away from your construction site during construction. In a situation where you cannot be physically present due to one commitment or the other, delegate this responsibility to someone you really trust.

Paying unexpected and regular visits to your construction site help keep the construction team on its toes. Monitoring the progress level of the construction work is an important aspect of the project.

Stay away from inferior building materials because they don’t last for long. You’ll also end up replacing the materials so frequently, you’re bound to regret using them.

Storage of Building Materials

The way you store your building materials is just as important as where you buy them from. You can carelessly allow your construction cost rise if you don’t pay enough attention to where and how your materials are stored.

Cases of theft and negligence have put potential homeowners in a situation where they spend more than necessary during construction. You want to steer clear of wastage by making provisions for this as well.

Run a Background Check
Before you make a decision on any professional when building your home, be sure to carry out a background check on their track-record and by seeking to speak to clients they have serviced in the past.

In addition to saving you valuable time and money, a background check also ensures you have a good experience during construction. Details like their fees, availability and performance are vital yardsticks you should use in determining who you eventually settle for.

Consider the Option of Modern Architecture
Modern architecture isn’t about lacing your home with sophisticated gadgets and toys. Instead, it is more about owning a home that is functional. To cut cost, you can go the route of building a container home.

Container homes, also known as mobile homes are prefabricated structures. They are built in factories on permanently attached frames. Upon completion, they are transported to your site.

Mobile homes are an emerging trend in modern architecture and are being used as permanent houses, for holiday purposes and for temporary accommodation. In some cases, they are left permanently or semi-permanently in a particular location but can be transported from one place to another.

Mobile homes have both pros and cons that you should know about. Your ability to know what works and what doesn’t. puts you in a better position to make more informed decisions.

Final Thoughts on Construction Cost
The smart way to reduce your construction cost is not necessarily by going for cheaper options wherever and whenever they are available. You need to remember that such choices can always come back to haunt you especially when they are inferior building materials.

Cement blocks are currently cheaper than bricks so, you should bear that in mind as you lay down your construction plans. You should also buy your building materials locally and create a proper system for account and document management.

Private Property News

GHL Bank Receives US $15 Million From AfDB’s Mortgaging Finance

The African Development Bank (AfDB) has approved a US$ 15-million senior loan to GHL Bank PLC, which focuses on mortgage finance, to enhance its mortgage loan portfolio and help develop an effective affordable mortgage industry in Ghana.

It said in a release to the Ghana News Agency that Ghana’s lower-middle and middle-income earners will now have greater access to long-term affordable mortgage finance.

GHL Bank PLC, formerly, Ghana Home Loans Limited was previously the only specialized mortgage finance institution in Ghana, helping to address the national housing shortage by providing long-term finance to lower-middle and middle-income new homebuyers.

It has disbursed over US$ 191 million in mortgage loans, benefiting more than 3,000 households, serving the majority of Ghana’s urban and suburban centres.

The senior loan will have multiplier effects on housing sector industries and employment in the mortgage value chain.

It will complement the government’s efforts to develop a self-sustaining long-term affordable mortgage market and encourage orderly urban development for providing basic utilities such as water, sanitation, roads and electricity.

The intervention is in line with the Bank’s High 5 agenda and specifically ‘Improving the quality of life for the people of Africa.’

It complements the Bank’s current initiatives to support affordable housing and development of mortgage finance institutions in Africa.

The Bank supports investments that help widen and deepen financial systems in Africa, and that enable the private sector to mobilize and access long-term local currency funding from local financial and debt markets.


Real estate life lesson: Read documentation carefully to understand terms of your mortgage

Know the rules of your loan, or else it will cost you a pretty penny.
Q: I recently took out a mortgage to purchase my first home. It’s a condo. I went with a nontraditional lender that offered a loan about 1 percent higher than the market rate, as this was the only lender who would fund a loan on a condominium with open litigation.

The association was suing the builder for construction defects. Within days of closing, the lender immediately sold my loan to a different loan servicer. About a month after the sale to the new servicer, I received notification from Fannie Mae that they had acquired my loan.

By February 2018 the litigation was settled, and I qualified for a standard loan with a traditional lender (“Bank”). A couple of weeks after successfully refinancing, I received notification from Lender A that Service had “hit” them with an EPO (early pay off) penalty, and I was incurring a prepayment penalty of approximately $10,000.

Given Fannie Mae was the owner of my loan at the time I refinanced, is this prepayment penalty enforceable? When I combed through my mortgage packet there is specific language in the Note and Deed of Trust saying I shall not be charged a prepayment penalty. However, sure enough, there was a supplemental “rider” included in my packet that stated I “may be charged a prepayment” penalty.

Does one document take legal precedent over the other? Am I still liable for the penalty?

A: A couple of years ago, the federal government enacted new rules governing disclosures when it comes to home loans. One of the important changes was the requirement that a lender delivers to you a closing disclosure. If you can go back to your file, you should see if you received this closing disclosure. We would be very surprised if you did not.

One of the main points of this closing disclosure document was to prominently display the basic terms of your loan. In large print and boxes, the disclosure will tell you the following: the loan amount, the interest rate, your monthly principal and interest owed, whether the loan has a prepayment penalty and whether the loan has a balloon payment.

It is not unusual for a lender to create a loan package and use the standard forms for residential notes and mortgages and then attach a rider with the prepayment penalty language. Having said that, it would be quite strange to us if the lender did not use the closing disclosure form. If the closing disclosure form indicated you had a prepayment penalty and that prepayment penalty was reflected in the note, it would appear you agreed to it.

Back in the boom days of the real estate market, pre-Great Recession, we would see quite a number of loans with no money down, loans with prepayment penalties and loans with negative amortization. We are aware some condominium developments do not fit into the nice categories Fannie Mae and Freddie Mac have for them, and that might lead you to use a different lender who offers unique or less than desirable loan terms.

When we have come across these types of deals, we usually see a higher interest rate. But, we have not seen prepayment penalty loans in quite some time; and we are pretty surprised your relatively recently closed loan had one.

You need to check all of your documentation. We have to assume that if the lender did not disclose the prepayment penalty to you as may have been required, the prepayment penalty may not be valid or, if it is valid, could give you a right to fight the lender on this charge. After you look at your documents, you will have a better idea of where you stand.

Once you have more information, you can address the issue with the lender or hire an attorney to go over the documents in detail and determine how to proceed.

To our other readers: You must read all of your documentation carefully so you know exactly what kind of mortgage terms you have agreed to and do not get surprised by an unwelcome, and very expensive, fee.

Ilyce Glink and Samuel J. Tamkin

Osinbajo arrives Edo on two-day visit, to commission housing estate

Vice President Yemi Osinbajo Thursday afternoon arrived in Benin, the Edo State capital, for a two-day official visit to the state.

The News Agency of Nigeria (NAN) reports that the presidential aircraft that conveyed the nation’s number-two man landed at the airport at exactly 2:29 p.m.

Mr Osinbajo, who is expected to inaugurate some projects in the state was received at the airport by Governor Godwin Obaseki, top government officials and leaders of the All Progressives Congress (APC).

The state cultural troupe was also at the airport to welcome the vice president to the ancient city.

NAN reports that the airport and the road leading to the city were adorned with posters and banners, welcoming the vice president.

Mr Osinbajo thereafter headed to Edaiken Market at Iselin, where he inaugurated a pilot phase of a solar power project under the Energising Economy Programme of the Federal Government.

He would also inaugurate the Benin Technical Innovation Hub that is expected to host over 25 ICT companies geared towards training young and old people on various ICT-based skills.

NAN reports that the two-day visit would also see him perform the foundation laying ceremony for the construction of 1800 housing units.

The housing unit is a joint venture project of the government of Edo and a private sector organisation.

Also in his itinerary, Mr Osinbajo would also visit the 480 mega watts Edo-Azura power project and also attend a town-hall meeting with beneficiaries of the Social Investment Programme (SIP) of the Federal Government.

The vice president would later meet with the Micro, Small and Medium Enterprises (MSMEs) community in the state, as part of the Federal Government’s efforts at deepening the sector to boost economic growth.



On November 11th 2015, Babatunde Raji Fashola (SAN) was appointed the Minister of Power, Works and Housing. His appointment then was greeted with mixed reactions. Some claimed the weight of handling three key ministries will be too much for him to bear while others believed he is a ‘superman’ who is equal to the herculean task.
Perhaps after listening to a wide range of public opinion, President Muhammadu Buhari decided to appoint two ministers of state for the Ministry to assist him. Baba Shehuri and Suleiman Hassan were appointed to assist in ensuring the delivery of good governance to Nigerians from the Ministry.

Speaking for the first time in December 2015 as the new Minister for Power, Works and Housing, Babatunde Fashola outlined his plans to reform the ministry.

In his inaugural media briefing with the theme, “Setting Agenda for Delivering Change”, Fashola picked his bearing from the huge expectations of the Nigerian public who voted for the All Progressive Congress (APC) message of Change and elected President Muhammadu Buhari to office having promised to address the challenges of security, corruption and dwindling economic fortunes of the country, Fashola noted that the cooperation of Nigerians was needed in order to achieve the realization of the expectation with the Ministry playing its expected role in the process.

In analyzing the current situation, the Minister blamed the economic downturn which has led to massive loss of jobs in the country, to the anomaly in budgetary expenditures over the years. He said in order to achieve the needed change in the economy of the country; the ratio of Capital Expenditure to Recurrent Expenditure must change in the 2016 Budget adding that this had been the bane of budget implementations in the past.

“The first thing that must change is the Capital to Recurrent ratio of the budget, and our colleagues in the Ministries of Finance and Budget and Planning are working on this and they will address you at their own time on the changes they have made and what citizens must do to enable them achieve that plan. As I have had cause to say before, the budget is the article of faith of every serious nation and government and our resolve to do more capital spending with less resources must be indicative of our seriousness to reflate this economy”, the Minister said.

On the issue of housing, Fashola noted that “if we complete our ongoing projects and we get land from the governors in all states and the Federal Capital Territory (FCT) to start using the LagosHOMS model, we should begin providing 40 blocks of housing in each state and the FCT.” He also stated that “we see this leading to the potential delivery of 12 flats per block and 480 flats per state, subsequently providing 17,760 flats nationwide, for a start.”

“The Federal Government of Nigeria plan introducing mortgage schemes and we plan adopting the Lagos state model, specifically Lagos Home Ownership Mortgage Scheme (LagosHOMS), to achieve this. The LagosHOMS project, has given about 400 people keys to their apartments in Lagos, since it was introduced in March 2014. This scheme was introduced to battle increasing over-population in Lagos state and the corresponding increase in rent in Lagos state. The scheme appears to be a success, attracting more customers every day. Nigeria would also benefit from the housing scheme, with projections indicating the country will be the fourth most populated country in the world by 2050.”

According to him, “This will translate into a minimum of 4 doors and 2 windows very conservatively per home; a demand for 71,040 Doors and 35,520 Windows nationwide in year one, which we will encourage to be made in Nigeria. The demand for those who will make and fix the doors and window, the hinges, the wood polish and the paint and tiles suggest the onset of jobs and change for our artisans and workers who are the real builders of every economy”.

The Ministry of Power, Works and Housing in 2017 unveiled a National Housing Policy that focuses on, among other things creating and expanding economic opportunity for Nigerian artisans, builders and tradesmen.
According to the minister in charge of the ministry, Babatunde Fashola, the policy is founded on the following considerations:
1. National Acceptability: A national housing program must have national acceptability in terms of diversity of design in response to cultural and climatic diversities. We have finalized and settled on 6 (six) designs, classified into 2 (two) broad sets of designs: Bungalows in the North and Blocks of flats in the South. All of these were achieved by local architects in the ministry with a voluntary contribution from outside the ministry, but with all of it totally home grown.
2. Standardization of Design and Input: The next step is to standardize these designs, windows and fittings and all of these have been done – again by local capacity.
3. Efficiency of Construction: The third step is to build industrially and reduce construction time. We are using local capacity to leverage international capacity to achieve this.
4. Local Content: We have resolved to use only the following made in Nigeria items; Doors, Windows, Tiles, Ceilings, Plumbing accessories, Cables, Paint and Ironmongery

To kick start action in the Ministry, the Federal Government in 2016 set out targeting the provision of mortgages at single digit interest rates and long tenor as it plans to unveil a new housing finance initiative. Minister of Finance, Kemi Adeosun, revealed this at the 32nd Annual Conference and General Meeting of the African Union for Housing Finance (AUHF) which was held in Abuja.

She said the initiative to finance housing projects is aimed at the construction of over 300,000 affordable houses through mortgage financing and creation of 700,000 new jobs across the housing development value chain. The minister explained that government was also contemplating putting in place foreclosure law and that would expedite legal processes for dispute resolution that is needed to support the development and growth of mortgage institutions in the country.

She emphasised the need to put in place monetary policies that would support low interest rates by finance institutions “as a means of boosting activities in the mortgage industry”, adding that federal government is committed to bringing down the current high interest rate.

Represented by Mr. Seye Senfuye, the minister said: “We are committed to fundamentally addressing historical challenges to housing. This requires innovative financial solutions that will stimulate housing development, related industries, create jobs across the nation and satisfy yearning for security through home ownership. Nigerians deserves to acquire affordable homes, built to a standard of good quality, located in well serviced estates that will create ideal environments in which they can raise their families, instead of being saddled with the challenges and risks of trying to build their homes organically. Due to the current high rates of interest, we believe that government intervention to bring down rates and enhance affordability is needed and we are committed to doing this.”

Also speaking at the event, Minister of Power, Works and Housing, Mr. Babatunde Fashola unveiled plan by the federal government to de-risk lending to property developers and provide guarantees and credit enhancement to stimulate growth in the housing sector. Fashola who was represented by Mrs. Eucharia Alozie, Director, Public Private Partnership (PPP) in the ministry, said government recognises that provision of leverage and guarantees are critical to attracting private sector funds to the industry, thereby creating thousands of affordable houses yearly and generating employment and commercial activities.

“From the inception of government’s initiative in organised housing finance system (in Nigeria) to date, only meager sum have so far been injected into the system. This accounts for less than 0.5 per cent of the GDP compared to other climes, like the United Kingdom and South Africa. This is due to the inability of financial systems to provide low cost finance that meets the need of low and medium income earners,” he stated.

Everything in life comes with its own challenges and Government’s intervention in housing is not an exception. At the 2017 Abuja International Housing Show, The Minister, Mr Babatunde Fashola, said the major challenges of housing development in the country are financing, affordability and acceptability.

According to him, majority of the estates are not occupied due to inadequate infrastructure, which discourages people who are interested in owning property.
“As we discuss housing finance, let also understand that financing is not only the problem, there are many others, there is the issue of affordability and also that of acceptability.
“ We have empty houses in many states of the federation, why are they not occupied, can people afford them; if they can afford them, do they like the way they were built?
“It is a problem, we must connect and build to the taste of the home taker, I think the financing and infrastructure problem will remain with us as long as we live.’’

He said that the ministry had in the past one year designed a national housing model in response to the climatic and cultural diversities of Nigerians.
Fashola said that the size of the problem in the housing sector should not affect the enthusiasm of Nigerians to find solutions to the present housing deficit.
“Let us focus more on what we can contribute, what we can do; rather than how big the problem is.
“It is indisputable that housing is a problem globally; so let us focus less on how big it is and focus more on what we can do’’ he said.

Determined to make housing finance easy and affordable, the Federal Government on August 29, 2017 initiated the Nigeria Housing Fund Programme (NHFP) which is under the Social Investment Fund of the Federal Government in which N100 billion has been set aside for its take off.

The Nigeria Housing Fund Programme was a Federal Government scheme that is being coordinated by the Central Bank of Nigeria, CBN, to ensure access to housing finance by prospective home owners. The scheme which has the World Bank and AFDB as contributors to the fund affords real estate developers who develop for social housing the opportunity to borrow 80 per cent of cost of project and source the remaining 20 per cent.

Specifically, the government has under the NHFP launched My Own Home Scheme to enlighten those seeking to own houses of theirs across the country on how to key into the scheme and become beneficiaries.

Unveiling the scheme in Lagos in 2017, stakeholders who were in attendance such as mortgage finance operators, Central Bank of Nigeria and NPF Micro Finance Bank lauded the scheme.

Mrs. Adenike Fasanya-Osilaja, Housing/Mortgage Finance consultant to the CBN on the My Own Home Scheme, said the initiative was in collaboration with the federal government, World Bank and Mortgage Banks Association of Nigeria (MBAN), with other relevant stakeholders to ensure that challenges in housing finance are tackled.

Fasanya-Osilaja explained that civil servants and prospective home owners in the private sector needed to be properly guided on the best approach to accessing mortgage loans, hence the launch, adding that the NHFP would create the enabling environment for strengthening the Nigerian housing sector by setting up sustainable framework for mortgage originators.

She said those mortgage originators range from financial institutions that provide housing finance to access long-term refinancing, pointing out that the framework will lead to setting up of mortgage guarantee/insurance as well as a housing micro finance scheme for strengthening of Nigeria’s housing micro finance sector. She noted that intending house owners are advised to shop around to compare rates before taking a mortgage or housing finance loan.

Fasanya-Osilaja further stated that the NHFP intervention would include a mass literacy campaign on consumer education, protection and responsibility with regards to housing finance in Nigeria, insisting that the campaign is aimed at educating every Nigerian on the right to own a home, the cost implications, advantages of taking loans to finance a home and to ultimately serve as a catalytic program to jumpstart the housing market in Nigeria.

Deputy Director, Other Financial Institutions Supervision (OFIS) at CBN and a Director in NHFP, Adesemoye Adedeji , disclosed that to ensure its accessibility and effectiveness, nine Micro finance banks (MFBs), would be participating in the scheme, which is funded with $300 million, adding that the arrangement would capitalise on mortgage guarantee and insurance with $15 million for the pilot housing micro finance.

According to him, the money was with the CBN for proper monitoring and execution to avoid disbursing it to wrong channels that can’t handle housing projects.

President of the Mortgage Bankers Association of Nigeria, and Managing Director, Trustbank Mortgage Ltd, Mr. Niyi Akinlusi, said the scheme was a departure from other housing schemes in Nigeria, noting that NHFP has set up a framework that would revamp the housing finance sector by making access to finance a lot easier through its four major components, which include the Nigerian Mortgage Refinance Company, whose task is to provide long-term refinancing of mortgages and standardizing mortgage procedures,

Mortgage Guarantee/Insurance Scheme, which is responsible for providing borrowers with initial down payment with mortgage for home ownership.
“The Housing Micro finance Scheme is meant to stimulate increased lending to low-income earners in the formal and informal sectors in Nigeria through Micro finance banks for incremental housing construction or housing improvement, while the technical assistance for the scheme shall ensure the protection of all the parties involved in the scheme”, Akinlusi said.

With two years gone in the life span of the administration, it was more promises galore. Babatunde Raji Fashola, the Minister of Power, Works and Housing disclosed that the Federal Government is committed to growing the housing sector and harnessing its vast potentials for sustainable national development, stating that housing has been a driver of economic growth throughout the world and that there is no reason why Nigeria cannot achieve same.

In his keynote address delivered at the 2017 World Habitat and World Cities Day commemoration in Abuja, the Minister, represented by the Minister of State II in the Ministry, Surv. Suleiman Hassan Zarma, said that the dual theme of the 2017 celebration : ‘ Housing Policies: Affordable Homes’ and ‘Innovative Governance, Open Cities, is a “reflection of a strong attempt to follow up on Agenda 2030 and the New Urban Agenda adopted in Quito, Ecuador in 2016”.

He added that it will afford policy makers in Nigeria the opportunity to review and evaluate past housing policies and assess their impact as well as strategize for the future. He said that government has put in place the necessary machinery to jump- start a housing revolution through the innovative nationwide National Housing Programme.

According to him, “the pilot implementation stage has already created opportunities for 634 contractors, created 13,689 direct jobs and 41,000 indirect jobs’’. He noted that if the Programme could be replicated on a yearly basis and also successfully implement the housing cooperatives, leverage private sector capacity, strengthen FHA and FMBN to play their roles, we will be creating an affordable housing economy that will fortify and transform our nation in the nearest future.

The Minister stated that, “to complement these efforts, we have activated the Road map for Nigeria’s Housing and Urban development Sector, and are in the process of producing a strategic National Physical Development Plan to integrate physical planning with economic development,” adding that the National Building Code was also being revised to curb incessant building collapse in the county and to ensure proper alignment with the International Building Code.

In his welcome remarks, the Minister of State I for Power, Works and Housing, Hon Mustapha Baba Shehuri, reminded stakeholders in the housing sector of their duties to develop policies capable of providing basic infrastructures and social services that could be lacking due to rapid urbanization of cities.
He said, “We are therefore duty bound to generate responsive policies which are capable of turning around the current poor state of our cities and guarantee efficient delivery of infrastructure and basic social services.”

Earlier this year, the Minister of Power, Works and Housing, Mr. Babatunde Raji Fashola, warned government agencies in the housing sector that the provision of affordable housing policy of the Muhammadu Buhari administration must be delivered to the people.
Mr. Fashola gave the charge at the inauguration of the Governing Boards of the Federal Housing Authority, FHA, and the Federal Mortgage Bank of Nigeria, FMBN, in Abuja. He said the agencies must be repositioned in order to deliver service to Nigerians.

The minister recalled that “Since the FHA and FMBN were set up, they have experienced their fair share of challenges while they have also become well-known brands within the country.”

According to him, “This is now your responsibility to reposition these brands and utilise them, by providing the guidance for the managing directors and management teams of FHA and FMBN to enable them deliver service to Nigerians. “For the avoidance of doubt, let me state that the policy of government is to deliver affordable housing, acceptable to Nigerians and these agencies, whose brands you will now administer are the implementing arms of government for housing delivery (FHA) and housing financing (FMBN).

“The managing directors and their management teams have the executive responsibility for carrying these out, subject to your Boards’ oversight, approvals and advice, while the ministry plays a supervisory role. “Therefore, we expect to see harmony, respect, teamwork and a healthy working co-operation between boards and management. On the part of the ministry, I assure you that we will supervise but we will not interfere. For your information, we are piloting a housing programme and currently constructing in 33 states of Nigeria.

“We do this to validate and test what type of housing design responds to Nigeria’s diverse cultural, climatic and religious needs, so as to ascertain what is acceptable and affordable. “We are at different stages of construction in different states, and we have recommended these designs to FHA, without imposing them. Our decision is informed by the evidence of previous housing initiatives that people did not take up and empty houses that still abound in almost every state of Nigeria.

“These houses that are not taken and the deficit of housing, suggests to us that the houses not taken are either unacceptable or unaffordable or both. We see housing as a product, and we take the view that before they can be delivered to market, we must know what the people want and what they can afford. When our pilot is fully completed, these answers will become self-evident and this is when we can mass produce.

“There is certainly nothing that stops FHA from undertaking other designs of housing if it can find a market for them, and it can deploy the income to cross-subsidize and make mass housing more affordable. As for the financing side, this is critical to affordability and it is as much the function of FHA in cost management and delivery as it is that of FMBN in delivering mortgages of affordable tenures and costs.

“Since May 2015 to date, FMBN has issued 2,724 mortgages worth N20.237 billion to assist Nigerians buy their own homes under the National Housing Fund NHF”

The effort of the Federal Government in the housing sector through the implementation of the National Housing Programme has so far yielded about 64,000 jobs. The government apart from addressing housing deficit in the country by injecting over 2000 housing units, the present administration has succeeded to some extent in reducing unemployment across the nation. This has become possible because of the multiplier effect that housing construction has on the economy. For instance, all categories of workers in the construction industry has benefitted from the Programme.

It is on record that in the few places where the NHP projects are being executed presently, artisans, farmers and suppliers in the country are getting more empowered through the National Housing Programme aimed at providing affordable houses in Nigeria.
Under the National Housing Programme, each State Government provides land while the Federal Government through the Ministry of Power, Works and Housing provides physical housing units in the 36 states.

As at today, the Federal Government is carrying out construction of housing units in 33 states of the Federation where land has been made available for workers under its National Housing Programme. Under the programme, 653 contractors were engaged in the pilot scheme to deliver 2,736 units, while a total of 54,680 people were employed in the process.

On May 29th this year, some experts in the industry had their say on the three years of the Administration so far in terms of providing affordable housing for Nigerians. According to Abioye Oke, the CEO of Lifestyle Asset Hub Ltd “as we reflect over the past 3 years of this Administration and how it affects the housing sector…. As you might all agree, the current traditional real estate acquisition options in Nigeria are not working for the majority…. Hence, the over 17m units housing deficit… I classify these options into 4. How many Nigerians can afford to buy a small 2 bedroom flat with 15m-20m? Not to talk of a Terrace Duplex Apartment. How many Nigerians benefit from our Mortgage System? Those that have access how many can afford the 30% equity funding? Most go to the bank to borrow their 30% and end up having shelter without Lifestyle.

He added that “how many Nigerians can boast of receiving a house as a gift from their late parents? Then talk of selling properties and saving up your commission. Or Sell 20 properties and get 1 free. Very smart options I will say. But how many people achieve this? Very few. Currently, Nigeria has over 17 Million housing deficit and it could take over 20 year to cure this”

Another expert, Joshua Egbagbe said “Manifestos are laudable, but are quickly forgotten when the realities of their implementation are realized. Unless there is a grassroots advocacy by the various associations, more of the same will continue. I would have thought that a deficit of 17 million housing units would be a catalyst for the political class, whether they be APC or PDP, to act. Put in perspective, 17 million units roughly equates to the populations of the 17 African counties with the smallest population. Is this not a clear example for Nigeria to grow its GDP?. If the political class doesn’t act as the catalyst, then someone like Julius Malema will”

For Mr Raymond Lebona “if the load is too big for Your Head, Shouldn’t your good neighbour offer you help”? Jokes apart, it’s truly our common responsibility to enforce accountability! Where have we all been, with our various “powerful” Associations and Professional Bodies in the built environment; without holding up for scrutinizing the Government’s self-arranged load, without stepping forward from Day 1 to hold serious, self-less and pragmatic “Load-Related” conversations with our friends and leaders in this matter?

REDAN’S POSITION ON THE SECTOR: Undefined Operating Environment Hurting Housing Sector
Taking a position on the happenings in the housing sector for the last three years, the Real Estate Developers Association of Nigeria (REDAN) expressed concern that the current undefined operating environment in housing sector has yielded too many casualties for the association to ignore.
The President of the association, Rev. Ugochukwu Chime noted that the challenges hindering a seamless interface of and smooth transaction on the housing value chain had been identified and would be dealt with progressively.

He said: “Issues of data, finance, land administration, monitoring and compliance with the extant laws and best practices e top of our priority list.

“In doing so, we call on government arms- the executive and legislature to give us support in our course to bring succour to the Nigeria’s real estate sphere. The structure and enabling environment that will govern the interface and relationships among players must be clearly defined.

“The current undefined and uncharted leap of faith operating environment has yielded too many casualties for us to ignore,” Chime said.

“We shall further the work we initiated with Federal Mortgage Bank of Nigeria (FMBN), Nigerian Mortgage Refinance Corporation (NMRC) and other stakeholders to ensure ease of doing real estate business and make home ownership accessible and affordable, while expecting cooperation from policy makers and other agencies,” Chime said.

Among the numerous impacts of the Federal Mortgage Bank of Nigeria (FMBN) in the last three years is its boosting of housing in seven states with 1,500 units. This was done amid concerns that a yearly rural-urban migration of over 5 per cent requires 720,000 housing units annually to fill the nation’s housing deficit.

The units developed by the bank in seven states; namely, Taraba, Kwara, Enugu, Ebonyi, Imo, Nassarawa and Niger were commissioned in 2017. For instance, in Jalingo, 202 housing units, made up of 88 three-bedroom semi-detached bungalows, 90 two-bedroom semi-detached bungalows and 24 one-bedroom terrace flats were completed.

FMBN has also funded a number of estates in Taraba State with a total investment of about N1.4 billion in the development of a total of 378 housing units.
The housing Estates being developed by FMBN across the country are financed from the resources of the National Housing Fund (NHF) Scheme. The NHF is a contributory scheme into which Nigerian workers in both the public and private sectors earning a minimum of N3, 000 per annum contribute 2.5per cent of their monthly income.

On the basis of their consistent and continuous contributions to the NHF scheme, Nigerian workers become eligible for mortgage loans at a concessionary interest rate of 6 per cent yearly and repayable over a maximum period of 30 years to ensure affordable home ownership among Nigerians.

The effect of these concessions reduces upfront homeownership costs by at least 20 per cent. By making homeownership more inclusive, FMBN is refocusing its business to make mortgages more affordable to a wider segment of the market, which now includes the mass and middle income segments of the population. The targeted average price per unit of a house to meet these customers is estimated at between five million to seven million naira per unit.

With these developments, FMBN is achieving its mandate in terms of cost management, resource optimization and waste reduction. For the 2016 financial year, the Bank posted an Operating Surplus (profit) of N2.7 billion – the first such impressive performance in two decades which is 50 per cent above the budgeted N1.8 billion for 2016.

Within the time period, the FMBN also delivered 72 housing units to the Ebonyi State Government for the use of its civil servants. The houses are located at Ezzambgo, Ohaukwu Council area of Ebonyi State. The housing units consist of 5 units of 3-bedroom fully detached bungalows, 30 units of 3-bedroom semi-detached bungalows and 12 units of 2-bedroom terrace. It also consists of 20 units of 2-bedroom semi-detached bungalows and 5 units of 1-bedroom terrace,” he said.

The Nigeria Mortgage Refinance Company (NMRC) has equally been active in the last three years. In 2017, in an historic move to deepen mortgage penetration and widen access to affordable housing, the NMRC in conjunction with the Central Bank of Nigeria (CBN), the Mortgage Banking Association of Nigeria (MBAN), the Federal Mortgage Bank of Nigeria (FMBN) and the Nigeria Deposit Insurance Corporation (NDIC) launched Uniform Mortgage Underwriting Standards for the informal sector.

The new standards will for the first time attempt to bring the operators in this sector, which constitute about 67.54 million of Nigeria’s 81.15 million workforces into the mortgage and housing net. The informal sector is estimated to account for over 60% of the country’s GDP.

The NMRC also signed a landmark partnership deal with Kohath Housing Corporation to provide over 15,000 housing nationwide to low income earners. The partnership would help bridge housing gap in Africa, especially in Nigeria.

Another deal was also struck with Modern Shelter Systems and Services Limited. In line with its market development mandate, NMRC signed a memorandum of Understanding with Modern Shelter Systems and Services Limited as part of efforts to remove systemic barriers to home ownership for off takers.
Key areas of focus for the partnership include resolving equity contribution constraints, improving access to mortgage loans and enhancing delivery of quality and affordable housing.

The partnership aims to facilitate access to alternative finance investors and improve Modern Shelter’s ongoing engagement with Sterling Bank and Jaiz Bank using non-interest mortgage banking structures. It will support Modern Shelter’s plans to deliver over 5000 housing units over a 5 year period across key states in Nigeria.

A housing expert, Mr Festus Adebayo, who has been at the forefront of advocating for affordable housing in the last 15 years appealed to the Federal Government to show more commitment and exercise strong political will in ensuring speedy growth in the housing sector.

Adebayo who is also the convener of the annual Abuja International Housing Show said “For the betterment of the housing sector, the Federal Government should show strong commitment by exercising the political will to make the housing sector grow.”
The expert commended the efforts of Fashola but said the present government can do better.

Adeleke Samuel, Housing TV

U.S. Mortgages at Lowest Delinquency Levels in 11 Years

According to CoreLogic’s monthly Loan Performance Insights Report, 4.3 percent of U.S. residential mortgages were in some stage of delinquency (30 days or more past due, including those in foreclosure) in March 2018, representing a 0.1 percentage point decline in the overall delinquency rate, compared with March 2017 when it was 4.4 percent.

As of March 2018, the foreclosure inventory rate – which measures the share of mortgages in some stage of the foreclosure process – was 0.6 percent, down 0.2 percentage points from 0.8 percent in March 2017. Since August 2017, the foreclosure inventory rate has been steady at 0.6 percent, the lowest level since June 2007, when it was also 0.6 percent. The March 2018 foreclosure inventory rate was the lowest for that month in 11 years; it was also 0.6 percent in March 2007.

Measuring early-stage delinquency rates is important for analyzing the health of the mortgage market. To monitor mortgage performance comprehensively, CoreLogic examines all stages of delinquency, as well as transition rates, which indicate the percentage of mortgages moving from one stage of delinquency to the next.

The rate for early-stage delinquencies – defined as 30 to 59 days past due – was 1.7 percent in March 2018, unchanged from March 2017. The share of mortgages that were 60 to 89 days past due in March 2018 was 0.6 percent, also unchanged from March 2017. The serious delinquency rate – defined as 90 days or more past due, including loans in foreclosure – was 1.9 percent in March 2018, down from 2.1 percent in March 2017. The March 2018 serious delinquency rate was the lowest for that month since 2007 when it was 1.5 percent.

“Unemployment and lack of home equity are two factors that can lead to borrowers defaulting on their mortgages,” said Dr. Frank Nothaft, chief economist for CoreLogic. “Unemployment is at the lowest level in 18 years, and for the first quarter, the CoreLogic Equity Report revealed record levels of home equity growth with equity per owner up $16,300 on average for the year ending March 2018.”

Since early-stage delinquencies can be volatile, CoreLogic also analyzes transition rates. The share of mortgages that transitioned from current to 30 days past due was 0.7 percent in March 2018, up from 0.6 percent in March 2017. By comparison, in January 2007, just before the start of the financial crisis, the current- to 30-day transition rate was 1.2 percent, while it peaked in November 2008 at 2 percent.

“As we enter the summer, the risk of hurricane and wildfire damage to homes increases as does the risk of damage-related loan default,” said Frank Martell, president and CEO of CoreLogic. “Last year’s hurricanes and wildfires continue to affect today’s default rates. Serious delinquency rates are more than double what they were before last autumn’s hurricanes in Houston, Texas, and Naples, Florida. The serious delinquency rates have also quadrupled in Puerto Rico.”

Michael Gerrity


Fuller Foundation Hosts NHA Delegates

As part of the slum upgrade program of the Liberian government, delegates from the Liberia National Housing Authority (NHA) comprising of the managing director, Duannah Siryon and the technical assistant, Kollie Bombo, recently paid a 2-day working visit to the Fuller office in Nigeria.

The reason for the visit was to discuss a collaborative partnership between the Liberian government and the Millard Fuller Foundation. Attending the meeting were the management team of MFF Housing, and the Shelter Afrique Resident Regional Representative & Regional Business Manager – Anglophone West Africa, Zachary Kenyatta Munene.

Sam Odia, the CEO of Millard Fuller Foundation made a presentation of the MFF housing model, its aims, objectives, vision, and projects. During his presentation, Odia said: “If the houses you are building are not affordable to 50 percent of the population in that area, then you are not building affordable houses.

“In Nigeria, we have a deficit of 17 million houses; this is a challenge in itself as 40 percent of the population earns less than US$40 per month. At the Millard Fuller Foundation, we are not just builders and developers; we are advocates of affordable housing. Our projects, over the years, have also provided a source of livelihood to many as we have created thousands of jobs since our inception. All our materials are locally sourced; we do not import anything and we are hopeful that jobs will be created for Liberians through our methods.”

In his presentation, Mr. Siryon said that though the Liberia NHA was created in 1962, it had built less than 2,000 houses. “President George Weah has been made to understand that housing is fast becoming a national security issue, which is why he introduced the Rural Affordable Housing Project with the aim of taking affordable housing to the rural areas. If people don’t have somewhere to stay, they become vulnerable to crime.

“Our strategic goal, therefore, is to make sure we build 30,000 affordable homes yearly, 60-70 percent of which will be located in the rural areas to encourage the movement of people to the rural communities, as Monrovia is already choked up with about 113 slum communities.”

He further said that though the unemployment rate in Liberia is 80 percent, while the youth population is 62 percent, the Millard Fuller Foundation will make a difference if it will put the climatic conditions into consideration by taking advantage of durable local materials and components that can build a decent house.”

After the meeting, the delegates went on a tour of the various Fuller Housing projects to get a first-hand assessment. Visibly impressed, Siryon commended the Millard Fuller Foundation for providing affordable homes to Nigerians and hoped that same will be replicated in Liberia.

The Liberia NHA was created in 1962 and is tasked with the mission of providing decent, adequate and affordable housing to low-income families, and to ensure the provision of community facilities, utilities and access to social services and economic opportunities.

Daily Observer

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