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Architects take to design-and-build as lull in real estate persists

More evidence that architectural companies are embracing design and build concepts are emerging, following the lull in the construction activity.
The move is triggered by declining new projects coupled with escalating construction cost that has forced individual builders to vacate sites.


Design–build is a project delivery system used in the construction industry.

It is a method to deliver a project in which the design and construction services are contracted by a single entity known as the design–builder or design–build contractor.

Design and build can be seen as giving a single point of responsibility for delivering the entire project.

The concept though not new in Nigeria, but has started gaining more ground and prominence in housing construction in which one entity – the design-build team – works under a single contract with the project owner to provide design and construction services.

Facts have shown that real estate sector had poor performance last year and recovery is still been awaited. The government’s piece meal implementation of the budgets and selective war against corruption has put real estate business into stagnation.

For instance, the real estate industry, which contributed 6.79 per cent to real Gross Domestic Product, dropped to 4.12 per cent in the third quarter of 2017; with interest rates currently steady within the lower double-digits.

The president, Association of Consulting Architects of Nigeria (ACANigeria), Mansur Kurfi who confirmed the development in the sector, said it came about due to clog in the real estate market.

Explaining further, Kurfi, an astute architect said although the model is not new, but it is now at on the increase than, it was few years ago because of the clot in getting new jobs.

According to him, the reason for diversification is that if you stay in your small cocoon, there is not enough business.

He stressed that architects are not just going into partnership; they are doing design and build themselves because of the main reason that if you stay in consultancy itself, there are not many jobs going around.

Describing it as a good thing, the ACANigeria president said many architects felt that since they have knowledge of designing the house, why don’t they invest in building themselves.

“ It is like architects that have decided to become contractors and design the building themselves. It even help the profession because as a designer you know what should be done but it also requires somebody that has a firm to go into construction or you partner with estate developers.

Also a past president of the association, Mr. Kitoyi Ibare-Akinsan, told The Guardian that a lot of professionals are now on design and build so as to generate cash flow to survive.

He stressed that there now are more collaborations between contractors and consultants forming partnership to develop either from the consultant side going to look for contractors to collaborate or from the contractor side going to look for consultant to collaborate.

According to him, it is too risky now for any consultant to stand alone because the first to suffer in this situation is the consultant.

He said: ‘obviously there is a drop in prices and we have some constructions going on but they are not in the speed they used to go on.

“ I am not sure that the few going on if you go behind the veil the projects are going on because of very special arrangement, they are probably done at lower prices than they would have gone before.

“People felt that there are many consultants around and they put less value on consultant work and put more value on construction works.

It is the basic view of human instincts that in construction you can see the bags of cements, the re-enforcement, sand and gravel but on the construction side, it does not matter, if you did 1000 drawings, they need to see in concrete terms and not what you are saying.

“But the implication is that people are going to take more risks by either under quoting jobs to collect mobilisations and risking abandonment of project and use of substandard materials”, he said.

For the second vice President of Nigerian Institute of Architect (NIA), Mr. Enyi Ben Eboh, design and build was not new but is now more prevalent because of paucity of jobs and because clients are unwilling to involve many people in their projects.

He stressed that clients may want to involve one person, who then look for others like the architects and structural engineers as consultants.

Eboh said since every contractor must have an architect that will design before the building, he must have them as well as project managers to over see.

He also affirmed that many architects, who have flair for construction, have their firms and therefore own their own construction companies, where they also work as consultants.

“ People now wear different caps. I can be a consultant and contractor with even an interior design firm. People are diversifying because of the economic situation, if they see that one side is not working, they go to others that can work”, he added.

By Bertram Nwannekanma

Kaduna, Sterling Bank seal N5b mortgage deal

Towards providing mortgages at single-digit interest rate, the Kaduna State Government has launched a N5billion fund with Sterling Bank to facilitate home ownership.
Under the scheme, the parties would each contribute 50per cent of the mortgage fund, which is billed to reach N5 billion for onward lending to aspiring homeowners. The fund will require beneficiaries to make security deposits of between 15 to 30per cent of the value of the houses while all mortgages must be liquidated within 10 years.


About 50 per cent of the mortgages will be used to support house purchases below N20 million, while home purchases valued up to N30 million will get 30 per cent of the funding.

The balance of 20per cent will be used to support home purchases above N30 million up to a limit of N60 million. Successful bidders in the sale of government houses programme can apply for the mortgage facility to help pay for the houses.

This was made known through representatives of the state government and Sterling Bank at a press briefing in the States’ capital.

Speaking on behalf of the government, the Special Adviser on Economic Matters to the governor of Kaduna State; Umma Aboki, said that the state is facilitating investments in the provision of mass housing.

He said: “To encourage more people to own homes, we also have to support the demand side through mortgage financing.”

Also speaking, the Group Head of Non-Interest Banking of Sterling Bank, Garba Mohammed said the bank has executed a Memorandum of Understanding (MoU) to provide the mortgages at 9.5 per cent per annum.

Mohammed disclosed that government is sacrificing the interest on its own part of the deposit, to achieves the single-digit interest rate on the mortgage product.

Inflation Rate Seen Heading Towards Single-digit

Inflation rate in the country has been projected to drop further in April, thereby inching towards a single-digit rate.

Analysts at FSDH Merchant Bank Limited stated this in a report. They anticipated that inflation rate (year-on-year) would drop to 12.43 per cent in April 2018, from the 13.34 per cent recorded in the month of March.


The National Bureau of Statistics (NBS) is expected to release inflation rate for April on May 13, based on the data release calendar on its website.

The investment bank said despite the increase recorded in the prices of some food and non-food items, the base effect of the Composite Consumer Price Index (CCPI) in April 2017, would depress the inflation rate.

It indicated that the value of the naira depreciated at both the Nigerian Autonomous Foreign Exchange (NAFEX) and parallel markets. According to the report, the value of the naira depreciated by 0.09 per cent and 0.14 per cent to close at US$/N360.17 and US$/N363 respectively at the NAFEX and parallel markets at the end of April.

“The rise in the international prices of food coupled with the marginal depreciation in the value of the naira led to an increase in the prices of imported consumer goods in Nigeria between the two months under review.

“The prices of certain seasonal food items we monitored appreciated in April 2018, leading to 0.86 per cent increase in our Food and Non-Alcoholic Index.

“This index increased year-on-year by 14.71per cent, up from 234.39 points recorded in April 2017. We also observed an increase in the prices of Transport and Housing, Water, Electricity, Gas & Other Fuels divisions between March and April. “We estimate that the increase in the CCPI in April would produce an inflation rate of 12.43 per cent lower than the 13.34 per cent recorded in March,” it added.

Also, the Financial Derivatives Company Limited projected inflation rate for April to reduce to 12.7 per cent, adding that food inflation likely to reach point of inflection soon.

It, however, identified likely risks to further drop in inflation to include the passage of 2018 budget, increased election spending and growth in broad money supply (M2).

Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele recently said the central bank would continue to work towards a single-digit inflation rate.

“We would love as much as possible to have inflation as low as possible. Last month, inflation was 13.43 per cent.

“We are hoping that in 2018, we should achieve a very low double digit inflation level and if we are lucky, high single-digit.

“And I think with that we should be seen to be moving in the right direction,” Emefiele had explained.

The Food Price Index (FPI) from the Food and Agriculture Organisation (FAO) for April 2018 showed that the Index averaged 173.5 points, 0.25 per cent higher than the revised value for March 2018, and 2.72 per cent higher than the April 2017 figure.

According to the FAO, sugar prices recorded the highest drop; vegetable oil and meat prices also declined.

However, prices of dairy and cereal continued to trend upward. The FAO Dairy Price Index was up by 3.4 per cent between March and April. Increased demand for all milk products, coupled with reduced exports supply, led to the increase in the Index.

The FAO Cereal Price Index also appreciated by 1.7 per cent from the previous month, on the heels of improved prices of wheat, coarse grains and rice.

On the flip side, the favourable supply glut in the market, and a weaker Brazilian currency (Real) continued to weigh on the prices of sugar. Hence, the FAO Sugar Price Index fell by 4.8 per cent in April to a 31-month low.

The FAO Vegetable Oil Price Index was down by 1.43 per cent, driven by a fall in prices of palm and soy oil, the key commodities in the Index.

The FAO Meat Index was down by 0.94 per cent driven by the decrease in the prices for bovine and pig meat.

By Obinna Chima


Borno seeks PCNI, UNDP, AfDB interventions on roads, housing

Governor Kashim Shettima of Borno State has called on the United Nations Development Programme (UNDP), African Development Bank (AfDB) and the Presidential Committee on Northeast Initiative (PCNI) to intervene in the completion of roads and housing projects in the state.


One of such is the rebuilding of the 190-kilometre Maiduguri-Bama-Banki and Bama-Gwoza roads, re-opened last month by military. Displaced persons in Gwoza also require 1,000 housing units to replace shelters destroyed by insurgents in 2014.

Shettima made the call at the weekend when the National Refugees Commission was distributing aid at Gwoza. The items were donated by PCNI to the state government.
“We have to overcome the main challenge of rebuilding these Cameroonian border roads that link Gwoza and Pulka,” he said. He said the rehabilitation of the roads would fast track the return of displaced persons in Maiduguri camps and host communities.

The governor further disclosed that Boko Haram destroyed over 56,600 houses, but the Ministry of Reconstruction, Rehabilitation and Resettlement (MRRR) has rebuilt 11,630 in Bama and 1,800 shops and market stalls.

Apex mortgage bank targets 50 million new subscribers

Amid cconcerns that some contributors to the National Housing Fund (NHF) have not been able to access loans, the Federal Mortgage Bank of Nigeria (FMBN) has assured Nigerians that the amendment of the enabling legislations in the scheme would make it more robust and beneficial.
Accordingly, the bank explains that the objective is to expand its coverage to capture the potential 50 million-market sizes and contribute significantly to the target of creating one million new mortgages on an annual basis, while maintaining the single-digit interest rate.


It also expounds that the step will further reach the downmarket beyond the lower medium income bracket; increase mortgage sector contribution to national Gross Domestic Product (GDP), meet the changing mortgage landscape and remain relevant in the face of other mortgage financing developments in the Nigerian Housing Sector.
The Managing Director/Chief Executive of the Bank, Ahmed Dangiwa, an architect, made this known in Lagos during the Lagos Housing fair under the lecture titled; “Exploiting opportunities offered by the National Housing Fund Scheme” in Lagos.

Over the years, the NHF Scheme has contended with periods of rejection by workers, but as at date, it has recorded a customer base of 4.6 million individual contributors and 22,290 organisations.

Currently, workers in twenty-eight (28) States of the Federation comply with the NHF Act by making monthly contributions. Regarding financial inclusion amongst the non-salaried, informal sector, 21,320 informal sector workers have been registered through 1,078 cooperative societies as contributors to the Fund.

NHF has funded the origination of more than 18,085 mortgage loans, the delivery of 25,850 housing units across the country, and 11,927 FMBN Home Renovation Loans, while a total of N19.3 billion has been refunded to 201,534 beneficiaries who have retired and consequently exited from the Scheme.

He restated that the bank was committed to achieving some objectives of the NHF which are: to mobilise funds for the provision of affordable housing in Nigeria; supply loans for building, purchasing and improving residential housing; incentivise capital market investments in property development and provide long-term loans to mortgage institutions for on-lending to contributors to the Fund.

“The framework for the NHF Scheme provided that its loans be granted at interest rates below market rates and on concessionary terms for affordability.

The purposes of the loans are also specific to funding mortgages for the outright purchase or construction of residential housing as well as the renovation/expansion of residential housing.
Over the years, FMBN has established construction financing loan windows to boost housing supply and is granting mortgage and construction loans through housing cooperatives. In addition, all contributions by individual workers are subject to a full refund, with savings interest based on terms specified in the NHF Act”.

Represented by the Zonal Officer of FMBN in charge of Lagos, Fashina Abiodun, he advised Nigerians to take advantage of its products which include; NFH mortgage loan, Estate development loan, the cooperative housing loans, FMBN home renovation loan and the ministerial pilot housing scheme.

He also assured that before the end of the next quarter, the Bank intends to achieve full automation of the NHF contributions collection process, to ensure transparency and accountability adding that each contributor will receive SMS and email alerts of monthly deductions and access historical contributions records online, real time.

“A “Rent-to-own” product is under process to eliminate the need for 10-30per cent equity down payment to make homeownership more accessible and affordable. The Bank is also engaging in strategic partnerships with stakeholders, through collaborations on the management and utilisation of the NHF Scheme.

“A case in point is the partnership with the Nigerian Labour Congress (NLC), Trade Union Congress (TUC), and the Nigeria Employers Consultative Association (NECA) for housing delivery to Nigerian workers.

Besides that, it is also a partner under the Federal Integrated Staff Housing (FISH) Programme aimed at facilitating homeownership for Federal public servants”, he said.

The major challenges of the NHF scheme according to him also include; workers’ contributions have been the only source of funding the NHF Scheme since inception, inability to enforce mandatory investments by commercial banks and insurance companies, and failure on the part of the Federal Government to make financial contributions, which has significantly limited the potential volume of resources.

He further added that the participation of eligible contributors to the Scheme is low, at just below 10per cent of the estimated 50 million-strong national workforce while affordability remains a major challenge to deepening the Nigerian mortgage market due to low-income levels in the country.

By Victor Gbonegun

Social housing as antidote to Nigerian housing challenges

On July 31, 2014, the Federal Government, in Abuja, launched the first 10,000 mortgages for affordable homes scheme. The then Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, stated that the Federal Government’s 10,000 mortgage scheme was inspired by former President Goodluck Jonathan’s pledge on January 16, 2014 when he launched the Nigerian Mortgage Refinancing Company (NMRC) with a view to making mortgage accessible to Nigerians to enable them purchase and own their own homes.


Through this scheme, Nigerians were assured of being pre-qualified for 10,000 mortgages to be provided by lenders most of whom were present at the launch. The NMRC was set up as a re-financing vehicle to provide mortgage lending institutions with increased access to liquidity and long-term funds, since the ability of banks to deliver mortgage services is limited by the fact that 80 per cent of all bank deposits are for 30 days only. Housing has a longer gestation period than commercial loans can accommodate. The NMRC, in ensuring greater access to finance for tenure of up to 20 years, was to accelerate the growth of the mortgage market for all income levels. The 10,000 mortgages scheme has been derailed by inconsistency of government policies in Nigeria.

On November 21, 2013, former President Goodluck Ebele Jonathan stated that Nigeria needs N56 trillion to bridge the country’s 17 million housing units deficit. Jonathan stated this at the 53rd General Assembly of the Nigerian Institute of Architects (NIA) in Abuja. The shortfall alone minus infrastructure, according to the former President, would require more than N56 trillion, at an average cost of N3.291 million per housing unit to remedy our housing situation. 10,000 homes out of the required 17 million homes are a far cry from our housing need and a child’s play. If 10,000 units of three bedroom bungalows are built every year, it will take one thousand and seven hundred years for the country to meet her housing need assuming demand for housing remains constant. Ifeanyi Onuba of The Punch on Sunday, August 10, 2014, page 25, reported that the Federal Mortgage Bank of Nigeria (FMBN) has disbursed a sum of N100.5 billion for building projects under the National Housing Fund (NHF). The NHF is a Federal Government scheme in which every Nigerian above the age of 21 in paid employment is entitled to a low interest government funded loan for a housing project. At a conservative cost of N3.5 million per three bedroom bungalow on a free land, this amount could only provide 287, 714 houses. With the way funds are managed in Nigeria, about 70 per cent of this grant will be expended on administrative expenses by the managers, while about 30 per cent will be disbursed as mortgages. This amount will deliver 86,314 units of three bedroom flats at N3.5 million per unit. Our zero infinitesimal delivery approach in housing, despite its recorded successes in helping to develop economies, is our major bane. This also means that we are still not serious from considerably reducing our housing needs.

The second problem with the above scheme is patronage by Nigerians. Demand for housing is a factor of income. In a country were over eighty per cent of the adults are either not employed or under-employed, one wonder how the mortgage will be repaid. In countries with higher employment rates like United States of America and United Kingdom, mortgage repayment still pose a problem, how much more Nigeria where over 80 per cent of the workforce are not employed or underemployed. In 2006, Professor Gbenga Nubi of the Faculty of Environmental Sciences of University of Lagos, established the fact that unless most senior civil servants in Nigeria perpetuate fraud, they cannot afford to purchase a two bedroom flat with their salaries with the attendant costs of feeding, transportation, electricity, telephone and medicals, in Housing finance in Nigeria: A need for Re-engineering. He suggested alternative financing approaches like integrated rural development, compulsory housing savings scheme, securitization and housing bond. Pension fund reserve in Nigeria which is now over N6.0 trillion, according to the Pension Commission, can also be used for housing provision. The potent solution to our housing problem is the development of social housing as housing should not be a poverty index. In a country with over eighty per cent of people within the poverty threshold, housing cannot be viewed as an economic good only. It is equally a social good. Housing is a right and several local and international covenants guarantee the right of people to social protection that will help to eliminate the worst manifestations of poverty. Chapter II of the Nigerian Constitution expressly provided, among other provisions, for the social protection of all. Convention 102 of the International Labour Organisation (ILO) (1952) on social security minimum standards emphasizes the following nine (9) specific social protection factors: medical care, sickness, unemployment, old age, employment injury, family allowances, maternity allowances, invalidity and survivors. Food and housing are considered as given.

The Universal Declaration of Human Rights (1948), Article 22 provides that Each person, as a member of society, has a right to social security, each person is entitled to obtain satisfaction of her/his economic, social and cultural rights, inherent to her/his dignity and to the free development of her/his personality, by the national effort and by international cooperation, taking into account the organisation and resources of each country. Without housing, nobody can fully enjoy his/her right to the free development of his/her personality. Adequate public infrastructure provision is a veritable tool of ensuring sense of belonging of the people and of reducing poverty and crimes. Housing infrastructure development, due to its nature, can be used to develop an economy. Housing construction generates high level of employment, involves great number of participants, does not accommodate class discrimination and is gender-friendly.

The right to housing is founded, deeply rooted and recognised under international laws. It was enunciated under Article 25 (1) of the Universal Declaration of Human Rights. The right to adequate housing has been codified in other major international human rights treaties. Article II (1) of the International Committee on Economic, Social and Cultural Rights (ICESCR) provides that states parties to the present covenant recognise the right of everyone to an adequate standard of living for himself and his family, including adequate food, clothing and housing, and to the continuous improvement of his living condition. The problems with Nigeria housing include the fact that some houses are over-designed in terms of space and quality. Most developers do not pay adequate taxes on their property development to the appropriate government authorities to redistribute wealth. Many developed houses do not have approved building plans, so revenues were not generated on the houses by governments. In some cases, because of the level of poverty versus the degree of aspiration to have a house, a lot of people develop houses with low quality materials and workmanship to save cost. This has often times resulted into building-collapse. Inheritance taxes are not paid after the demised of the owners of properties by the heirs and inheritors.

Some unnecessary features are included in the houses of the rich just because they have access to free funds. Some houses are finished, mostly in branded areas, and are not occupied due to outrageous rents being demanded by the landlords and/or their agents. There is no law in place to tax vacant properties more than the occupied to encourage occupation and market dynamics. Some people have more than one house at no extra cost to them. Nigeria has more than her share of abandoned housing projects due to problematic cash flow. In a country with over 911,000 kilometre square of land mass, oceans, rivers and lagoons are being sand-filled to create housing estates. These and many more cause capital sink. The first house of any man is basic and should be assisted or subsidised. Any other one is investment and should be heavily discouraged through taxation. There must be register of property owners in Nigeria to know each person’s holding capacity. A house is a basic need that shelters people and gives them comfort. It is a place where people strategise, plan their future, and train their offspring. It also serves as working and resting place. A house is a status booster and the notion of owning a house bestows confidence on its owners irrespective of class. According to Professor Tunde Agbola of Department of Urban and Regional Planning, University of Ibadan, housing is a bundle of joy. Renters and homeless go through moments of stress, distress and uncertainties. A house is a common good that every adult who is working, either as a business man or in paid employment (formal and informal workers), should have. Proper housing can reduce health problems and crime. Since health is wealth, effective property taxation and housing development can be used to redistribute wealth and reduce poverty.

The 10,000 homes mortgage launched in 2014 by the Federal Government is good and welcome. Recent plans by the federal authorities of President Muhammadu Buhari to adopt sustainable housing programme, promote alternative energy in projects, stimulate jobs for the low income earners and partner state governments in the process of housing provision is also laudable. With the new housing policy, the federal government will employ Lagos housing model (Laghoms) by constructing 40 blocks of housing in each state and the Federal Capital Territory (FCT). Each state is expected to provide land of between 5-10 hectares for a start, with title documents, and access roads or in lieu of access roads, a commitment that they will build the access roads by the time the houses are completed. This exercise will lead to potential delivery of 12 flats per block and 480 flats per state, and 17,760 flats nationwide. Human beings, generally by their nature, exhibit multi-territoriality. This means that the beneficiaries are definitely going to be those with one or two houses before. The number of flats to be delivered is also negligible and will not affect the graph of housing demand versus provision in Nigeria. Also, the Shehu Shagari era federal housing experience shows that some states may decide to donate disuse and bad land to make the scheme unpopular considering the adversary between states and federal governments in some areas. Most states are finding it difficult now to cope with infrastructure provision, especially payment of salaries and pension. They may therefore, not be able to provide infrastructures in the estates.

Government has no excuses for abdicating its duty of care for the downtrodden and the vulnerable in Nigeria. Oil subsidy can be eradicated and in its place should be social housing development and agricultural grants. It will go a long way if the governments can declare state of emergency in housing provision in Nigeria and provide minimum of 500,000 houses every year as social housing for the poor in our major cities.

Oyedele, a Housing professional wrote from Osogbo.

Affordable Green Housing For Nigeria

An estimated 80% of Nigerians live in indecent, informal housing structures with no basic amenities and in deplorable conditions. Only few own the house that they live in. Chinwe Ohajuruka set out to prove to the Nigerian authorities and to communities in Port Harcourt in southern Nigeria that change is achievable – and that change means green housing.
I could not believe the words of the former Minister of Housing, Ama Pebble when she pronounced then in 2011: 80% of Nigerians living in deplorable conditions, in informal housing without access to potable water and other public infrastructures. That would have affected 130 million Nigerians at the time! This was especially shocking, as, at that time, Nigeria was the 8th largest exporter of oil globally. At the same meeting, the Minister also estimated the housing deficit at a whopping 17 million units.



With an estimated 2014 population of 178.5 million Nigeria is currently the 7th most populous country in the world. As the population grows, so does the housing deficit, as the number of houses being built does not come close to the desperate need. In May 2014, at a World Bank forum, the Coordinating Minister for the Economy and Hon. Minister of Finance of Nigeria Dr. Okonjo-Iweala had some grim statistics concerning housing construction, home ownership and mortgage penetration as follows:

Mortgage finance (as a share of GDP) is extremely low in Nigeria at 0.5%, compared with 80% (UK), 77% (USA), 31% (South Africa) and 2% (Ghana).
The housing and construction sector account for only 3.1% of Nigeria’s rebased GDP.
Housing production is at approximately 100,000 units per year while 800,000 units are needed yearly.
As a result of this lack of a robust mortgage financing system, Nigeria’s rate of home ownership is one of the lowest in Africa at 25%. According to the Managing Director of the Federal Mortgage Bank, Nigeria’s homeownership rate is much lower than countries like Singapore (90%), Indonesia (84%), Kenya (73%), USA (70%), Benin Republic (63%) and South Africa (56%).

In addition to these obstacles to home ownership, Nigerians face daily battles with poverty, unemployment, low human development index (HDI), low access to clean water & improved sanitation and incessant power outages. A large percentage of Nigerians are unbanked as only about 40% of the adult population is financially included.


“Success occurs when opportunity meets preparation” – Zig Ziglar (1926 –2012)

Soon after I became aware of these troubling housing statistics, a golden opportunity arose, to demonstrate that green building could be viable at the affordable housing level.

The African Diaspora Marketplace (ADM II) Business Plan Competition

In 2012, in collaboration with an amazing team of dedicated professionals committed to sustainable development, we entered an African Diasporan business plan competition in the United States. The competition was organised by USAID and Western Union for Africans wanting to do meaningful and innovative development in their home countries. Out of 495 entries, we were delighted to have been among the 44 finalists, and ultimately, one of the 17 winners! Our winning entry was titled “Renewable Energy through the Vehicle of Affordable Housing” and our innovation was called the “Passive House Prototype”.

The term passive house (Passivhaus in German) refers to a rigorous, voluntary standard for energy in a building, reducing its ecological footprint. It results in ultra-low energy buildings that require little energy for space heating or cooling.

Our definition of “Passive House Prototype” (PHP) tailored to tropical Nigeria was: “A building that uses 50 – 75% less energy than a similar building in a similar location”. We boldly designed, engineered and built an energy-efficient model of affordable housing, targeted at upgrading the “Face-Me-I-Face-You” tenement housing. Our goal was to prove that it is possible to do well while doing good, thereby inspiring the private sector to get involved in green building and sustainable design at the grass root level.

We chose to upgrade the “Face-Me-I-Face-You” housing type because it is the most affordable and commonly found in urban areas across Nigeria. These rooming houses or tenement buildings usually accommodate whole households (of up to 8 persons) in one or two rooms, with central corridors, shared kitchens, toilets and bathrooms. They are often fraught with problems of security, safety, privacy and dignity, with living conditions that are less-than-ideal.
Building & Site Characteristics

Each building comprised 4 units for 4 families arranged around 2 courtyards on a single minimum-sized plot of land (15m x 30m, or 50 x 100 feet). Each courtyard is shared by 2 families, and each dwelling unit (of approximately 40m2) includes:

1 living room
1 bedroom
1 kitchen
1 bathroom
Flexibility – each building can comprise 1, 2, 3 or 4-bedroom units.
Phase-able – the units could be based in phases
The Process & Projects

Completing the detailed design, engineering, specifications bills of quantities and planning approvals took nine months. We approached the Rivers State Government and received instant support when we explained that we intended to build sustainable affordable housing. The approval process was thorough but swift and we were invited to make a presentation to the Executive Council of Government. We started off by building two prototypes in Igbo-Etche, Port Harcourt, close to the well-known “Eleme Junction”. The buildings had identical floor plans but used different materials for the exterior walls. One was built with 9-inch sandcrete blocks and the other with 9-inch compressed earth blocks (CEBs).

In June, 2013, a block-making machine was brought to site and the CEBs were moulded from a composition of 95% laterite and 5% cement. The laterite came from Obehie, Abia State, 35 kilometres from the site.
Construction of the two buildings started simultaneously in July 2013 and by December 2013, two PHPs, comprising eight 1-bedroom apartments were erected.
Second Project

During the construction of the Igbo-Etche project, we were awarded the construction of another Passive House Prototype close to the Port Harcourt International Airport at Igwuruta-Ali. This time, we were asked by the client to build the external walls using a combination of sandcrete blocks and CEBs. Construction started in October 2013 and by December 2013, this PHP, comprising four 1-bedroom apartments was erected.
The solar system was installed, activated, and the building turned over to the client in September 2014.
Lessons Learned

On both projects, various challenges were experienced, not totally unexpected on pilot projects. Of significance was that they were built during the rainy season, which, in Port Harcourt, involved very heavy rainfall. This caused delays, as September typically has 21 rainy days out of 30!
Building sustainably basically involved going back to first principles of bio-climatic design.
With careful thought and team collaboration at the design stage, the projects did not cost more.
Using compressed earth blocks resulted in cooler interiors.
The CEB walls took less time to erect, but in this case, were not cheaper than the sandcrete block walls. Laterite for the CEBs had to be transported from a distance.
If the laterite source is close to the site, CEBs can work out much cheaper than using sandcrete blocks, as erection is faster, mortar is not needed and the walls do not need to be plastered.
Light coloured roofs, light coloured walls and shading went a long way in aiding the building to cool itself, eliminating the need for expensive mechanical cooling equipment.
Economies of scale allowed for more cost-efficient construction. The costs could go as low as N7.5million per building if 10 or more were to be built at the same time.
With commitment and care, it is certainly possible to do sustainable affordable housing developments!
Opportunities for the Government

In October 2014, the Minister of Lands, Housing and Urban Development, Mrs. Akon Eyakenyi stated that 43,126 housing units had been added to the nation’s housing stock between July 2010 and September 2014. She also said the Federal Government has created the enabling environment for the private sector to take the front seat in the provision of housing for millions of homeless Nigerians. While these achievements are commendable, Nigeria needs to build at least one million housing units per year to address the growing deficit and population increase. Enabling conditions such as providing infrastructure, unlocking land, reducing bureaucracy and increasing the availability of mortgage and construction finance will facilitate the process. If housing policy is focused more towards building sustainable 1-bedroom units, more decent housing can be provided affordably to improve the living conditions of a greater number of people in less time! These will come with added benefits of clean energy, potable water, improved sanitation, employment, poverty reduction, wealth creation and national economic growth.

Opportunities for the Financial Sector

The absence of mortgage products is a huge barrier to large scale provision of affordable housing. 1-bedroom apartments are cheaper and quicker to build than larger residences and micro mortgages and/or micro loans could be designed to service this housing type. The provision of housing microfinance and micro-mortgages could also present opportunities for reaching the unbanked and increasing financial inclusion in Nigeria. Home-ownership is a dream of all and could be the bait used to draw in the informal sector through housing cooperative schemes, to open accounts and make regular deposits. Micro-mortgages should be expanded to include home construction, as most of the houses in Nigeria are self-built.

Opportunities for the Private Sector

We could not have achieved the success in developing our Passive House Prototypes without the collaboration and support of the Rivers State Government, especially the Greater Port Harcourt City Development Authority. We discovered that engaging the government brought interest, cooperation and more opportunities. The government cannot and should not have to solve the problem of the housing deficit on its own, and is waiting for the private sector to come forward with bold and innovative ideas. The opportunities for the private sector are endless, ranging from Public Private Partnerships, to private sustainable real estate development. Imagine how the built environment could be transformed if large corporations invested in affordable green estates for their lower income staff as part of their corporate social responsibility (CSR).


On a site visit in 2013, I hired a taxi driver called Faith to take me to and from the project sites. After I had spent about 2 hours inspecting the construction and taking photographs, he remarked:

“Madam, I hope you don’t mind if I say something? I took my time to go around the site and inside all the buildings. At first, I thought you were building a house for yourself. But when I went inside, I saw that each building had four apartments. Each apartment had 1 living room, 1 bedroom, 1 kitchen, 1 bathroom, a small store and a corridor. I realized that these apartments were for people like me! Wow Madam! Look at the quality! Wow! Madam, you should run for office!” His comments revealed to me that people are not asking for too much to be satisfied: food, clothing and access to decent housing, all of which are fundamental human rights. Faith will indeed become one of the potential homeowners, as he has expressed his willingness to occupy one of the apartments. He also has a community of people that he says would also be willing to move into the apartments, and he is delighted at the prospect of owning his apartment in the not-too-distant-future. Together, we will navigate the journey of obtaining financing until they own the units. We will start with a “Rent-to-Own” agreement, and explore traditional and modern sources of microfinance such as “Isusu” and micro-finance.

Affordable green housing could well be the “silver bullet” to address the triple bottom line for sustainable development in Nigeria. With the sheer size of the Nigerian market and economy, Nigeria could lead the world in environmental sustainability, affordable green housing, green mortgages and leases, green facility management and achievement of its Millennium Development Goals.

by Chinwe Ohajuruka

A Comparative Analysis of Housing Indicators in China and Nigeria

In our previous review of “Nigeria’s journey towards sustainable housing provision”, we highlighted several housing indicators in the areas of housing deficit, mortgage interest rate, mortgage down payment rate and repayment period, policy reforms, cost of housing, which were used to explain the current state of the housing in Nigeria. In this second edition of the review, a simple comparative analysis of housing in China is done to further explain the dire need for the complete overhauling of Nigeria’s housing sector.

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China is a socialist state, with a government with crystal clear vision of its role. China is the most populated country in the world with a population of about 1.4 billion people. Given this population, one would assume that China would suffer from extreme housing deficit, but the numbers in China’s housing sector are fairly good. While Nigeria has a housing deficit of 17 million, 90% of families in China own their homes and 80% of these families acquired the homes outrightly, without mortgages or loans.


China has seven of the world’s top ten most expensive cities for residential property. The prices of houses in China are very high when compared to their income, price-to-income ratio (PIR). This however, does mean that the country is in a severe housing situation, the system can be said to have been managed almost effectively by forces of “government policies” and “way of life”.

The process and qualification for getting mortgages in China is relatively straight forward and low, respectively. At most, the mortgagor will need to have a monthly salary that is at least twice the monthly repayment rate of the loan. The outcome of this is that mortgages perform well in China, and in 2013, default rate was a mere 0.17%. Usually, a down payment of 30% is made on mortgages, which is 5% higher than that of Nigeria. However, interest rate on mortgage in China is about 6%, almost 4 times lesser than Nigeria’s. It is important to recall that mortgages are uncommon in Nigeria due to high interest rate and the arduous process of getting a mortgage.

Majority of the Chinese don’t mortgage, just 18%, as earlier mentioned 80% of homeowners acquire their homes outrightly. Hence, mortgages contributed 15% to China’s GDP in 2012. This is still higher than Nigeria’s 0.5% mortgage contribution to GDP in 2012.

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China also has a Housing Provident Fund. In a way, the Fund works like the Nigerian pension system in which employees and employers co-contribute to a pension account. A part of the Housing Fund, included a savings plan initiated by the government in which employees are given the option to contribute a portion of their monthly wages and have it matched by their employer to assist them with buying a house. This has contributed positively to mortgage acquisition in China, as prospective home owners are able to make the required 30% down payment.

Just like Nigeria, China has had several housing policy reforms, but so far, the difference in both countries has been the approach. While Nigeria’s style is for each administration to come up with a policy that can be attributed to the office holder, without good reference to learning points from previous reform(s) as every effective policy reform should do, China has transitioned from one policy reform to another with the soul aim of scaling up successful practices and downscaling non-performing ones. For China, policies have resulted from current realities. Among the latest drive by the government of China, is to regulate the rising rent cost in cities.


The success story of housing in China is as a result of an interplay between culture and systemic and intentional policies driven by its government to ensure sustainable housing provision for its citizenry. The government has largely charted housing in the country onto a sustainable path. Housing policy reform after reform, the government’s aim has simply been to provide adequate housing for its people. As for culture, the Chinese treasure home ownership, to many of them it could be their lifetime’s biggest achievement and they would work diligently towards saving up to buy one. Parents go out their way to support their children in getting their own homes, owning a home is somewhat of a yardstick for being fully prepared for marriage.

We have seen where Nigeria stands from the comparison; we can also deduce who/what the major actors in China’s housing sector have been. The last article in this series will be released in two weeks from today and will basically feature solutions to Nigeria’s housing woes. It will involve a mix of adoptable policies, low cost housing option and many others, till then, please stay tuned.


Study Reveals Housing Microfinance Can Become Major Offering For Financial Institutions

A new study from Habitat for Humanity says that housing microfinance can and should become a mainstream offering for financial institutions in Sub-Saharan Africa.


Housing microfinance consists of small, non-mortgage backed loans starting at just a few hundred dollars that can be offered to low-income populations in support of incremental building practices.

The business case study, released today, is entitled “Building the Business Case for the Housing Microfinance in Sub-Saharan Africa.”

It builds on a project carried out over six years in Kenya and Uganda called “Building Assets Unlocking Access”.

The project was a partnership between Habitat’s Terwilliger Center for Innovation in Shelter and the Mastercard Foundation.

So far, the project has reached over 47,000 households and mobilized more than $43 million in capital to benefit over 237,000 individuals.

The business case study argues that housing microfinance, small non-mortgage backed loans for short terms, can become a mainstream offering in the market to address growing housing needs in the region, incremental building patterns, and the land tenure realities of low-income households.

There are an estimated 1.6 billion people in the world living in substandard housing. This figure is climbing, especially as the world becomes more urbanized and people migrate to cities for economic opportunity.

In Sub-Saharan Africa, however, as much as 99 percent of people do not have access to formal financing – credit, savings, mortgages – that can let them start building or improving their homes. Traditionally, they build homes gradually as their resources allow.

Developer-built, bank-financed homes are rare in Africa, serving fewer than five percent of households in most countries.

“Solving the housing challenges in Africa will require a massive amount of capital investment and most of that will need to come from the private sector,” said Patrick Kelley, Vice President of Habitat’s Terwilliger Center for Innovation in Shelter.

He said, “Financial institutions of all kinds have a role to play, especially those already deeply embedded in communities and who understand people with informal sector livelihoods.”

Habitat’s Terwilliger Center for Innovation in Shelter partnership with the Mastercard Foundation sought to motivate local financial service providers in Kenya and Uganda to develop housing microfinance loans to fund the incremental building process common among low-income households.

The results have proven that there is demand for housing microfinance among families or individuals earning as little as $5 a day who are seeking to build, extend, or renovate their home.

“At the Mastercard Foundation, our focus is on helping economically disadvantaged people, especially young people in Africa, to find opportunities to move themselves, their families and their communities out of poverty,” said Ruth Dueck-Mbeba, Senior Program Manager at the Foundation.

“This project has provided access to appropriate finance for decent housing. We believe that decent housing can provide more than four walls and a roof over one’s head. It offers people hope, dignity, and a place in their communities.

This report should help financial service providers to scale these products, which would benefit their enterprises as well as the lives of many poor people in Africa,” she added.

Financial institutions in the region that have ventured into housing microfi­nance have often reported it to be a popular product with their clients.

To understand the demand side factors, the value proposition of these products, the competitive advantage of financial service providers offering it, and the differentiated features that make housing microfinance a strategic product, the business case study surveyed the work of two financial institutions: Kenya Women Microfinance Bank, or KWFT, and Centenary Bank in Uganda.

The study argues, through the lenses of these two institutions in different geographies, that success and profitability of a housing microfinance product relies on a number of factors: connection with the financial service provider’s mission, good marketing, a clear pricing structure, understanding of land tenure realities, an opportunity to attract new clients, and secure long-term capital to fund the expansion of such portfolios.

“Financing incremental housing solutions is a natural step in the progress of greater financial inclusion. Centenary and KWFT are providing a great example of how financial institutions will benefit from understanding their clients and developing products that serve them well,” said Patrick Kelley.

Eco-Stone expected in Lagos for mass housing under state’s LAPH initiative

Eco-Stone, a foreign firm with expertise in mass production of affordable housing using a building system called Solar Light Weight Concrete, will soon be in Lagos to drive the state’s civil servants-focused Lagos Affordable Public Housing (LAPH) initiative, the state’s commissioner for housing, Gbolahan Lawal, says.
The firm has capacity to deliver a house in just seven days, which is why the state government considers it a good ally in the implementation of the LAPH initiative, which targets 20,000 housing units to be delivered in the next four years.

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The company has already signed an agreement with the Federal Government to deliver 2,000 housing units under the government’s Federal Integrated Staff Housing (FISH) programme.
“The LAPH initiative is part of our efforts at addressing the supply side of the state’s housing challenge; we have about eight other partners with whom we have memorandum of understanding to deliver housing,” the commissioner said, pointing out that a 2014 survey carried out by the state revealed about 3 million housing units deficit.

To address the housing demand side, he said apart from their rent-to-own homeownership scheme, which is a modification of the Lagos Homeownership Mortgage Scheme (LagosHOMS), the state had also partnered the Nigerian Mortgage Refinance Company (NMRC), to provide access to housing finance through its-member primary mortgage banks (PMBs).
The state is also working with the pension commission with a view to creating a fifth fund—pension contributors’ housing fund—that will be 20 percent of present and future contribution. “It is proposed that this should be lent out at 5 percent interest rate to enable the mortgage banks create mortgages at 8.5 percent for home seekers as opposed to the current 22.5 percent,” he assured.

Apart from commending this move, analysts also see these partnerships and funding arrangements enabling more Lagos residents to own homes, especially through the Rent-to-Own scheme, which allows tenants to pay rents on the houses they live in consistently for five to 10 years, and at the end of that period, own the houses.
But there are concerns too. Given the state government’s antecedents, these partnerships may collapse mid-way into implementation.
The termination of the state’s partnership agreement with the Lekki Concession Company (LCC) which was to reconstruct the Lekki-Epe Expressway on build, operate and transfer (BOT) lease agreement is, in the opinion of analysts, a big drawback on PPP as a vehicle for delivering infrastructure.

The concession agreement for the reconstruction of the Falomo Shopping Complex, which was concessioned to Afriland Properties was also terminated by the state government under Governor Akinwunmi Ambode who argued that the concession was against the interest of Lagosians.
The state’s attitude to partnership arrangements have continued to be a disincentive to investors, especially property investors, who are attracted to the state because of its huge market.
Lagos has a large population estimated at 20 million. Its housing market can be likened to a pyramid in which supply is concentrated at the top pointed end while the base, which harbours the chunk of the population, suffers huge housing demand-supply gap.

A recent report by on the state’s housing market says about 65 percent of the state’s population lives in rented accommodation, spending over 50 percent of their monthly income on paying house rents. This underscores the level of housing affordability among the residents.

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