AfDB, Partners Launch New Fund to Boost Digital Financial Inclusion

The African Development Bank (AfDB), and its partners, yesterday, launched the Africa Digital Financial Inclusion Facility (ADFI), designed to aid safety and expansion of digital financial transactions in the continent.

The Fund, launched at the Bank’s Annual Meetings in Malabo, Equatorial Guinea, is supported by the Bill & Melinda Gates Foundation, the Agence Française de Développement (AFD), and the Government of Luxembourg, as initial contributors.

The goal is to ensure that at least 320 million more Africans, of which nearly 60 per cent are women, have access to digital financial services.

The fund will deploy $100 million in grants and $300 million in the form of debt from the Bank’s ordinary capital resources by 2030, to scale up electronic financial services for low-income communities.

“We believe that with the right investments in innovation and smart digital growth, the obstacles to achieving financial inclusion and greater economic opportunity for all will be overcome,” AfDB President Akinwunmi Adesina said.

The interventions will be aligned to four pillars; infrastructure, including digital and interoperable payment systems; digital products and innovation; policy and regulatory reform and harmonisation; and capacity building. It will help to close the transaction gender gap between men and women.

Africa saw double-digit growth in mobile phone ownership in the first half of this decade, triggering a surge in innovative digital tools and services across the continent. Yet, the benefits are not shared equally. It is estimated that only 43 per cent of adults across Africa have a banking account.

“Financial inclusion, achieved through digital financial service models, is simultaneously a powerful anti-poverty strategy and a catalyst of sustainable economic development for national and regional economies,” said Michael Wiegand, Director of the Financial Services for the Poor Programme at the Bill & Melinda Gates Foundation

ADFI’s opening project, which serves as a pilot for the facility, is a $11.3 million grant from the Bill & Melinda Gates Foundation to the Bank and the Central Bank of West African States. The grant will create an interoperable digital payment system that will allow consumers to send and receive money between mobile wallets, and from these wallets to other digital and bank accounts.

“With ADFI, we are convinced that our joint efforts can contribute efficiently to bring down the barriers that still undermine the full potential of digital finance in Africa.

It will enhance the delivery of quality and responsible digital financial services to the underserved, a cornerstone to inclusive and sustainable financial systems. AFD welcomes the specific attention that will be given to women’s digital financial inclusion in the evaluation of the projects to be supported,” said Sébastien Minot, AFD’s Deputy Head for Africa.

The ADFI will work with banks and non-bank financial institutions, mobile network operators, remittance and payment service providers, fintech companies, government ministries, regulatory bodies as well as regional economic organisations.

“Luxembourg believes that poverty reduction and social cohesion go hand-in-hand with economic empowerment and financial inclusion. ADFI provides an excellent platform for Luxembourg to combine its focus on economic inclusion with its Fintech orientation for the benefit of Africa’s poor,” said Georges Heine, Alternate Governor for the AfDB from the Luxembourg Ministry of Finance.

A three-member panel including Bank Vice President Pierre Guislain, Private Sector, Infrastructure and Industrialization, discussed modalities, expected challenges and policy requirements that must be in place to enable the fund achieve its goals.

Other members were Vanessa Moungar, Bank Director of Gender, Women and Civil Society, and Konstantin Peric, deputy Director, Financial Services for the Poor at the Bill & Melinda Gates Foundation.

Source: GuardianNg

Behind Deadline: Home Projects Suffer From Worker Shortage

Lynn Osborne has been remodeling two homes. They are different styles, in different states, with different contractors. But there has been one constant: delays due to a shortage of skilled labor.

The two-year remodel of her primary home in Fort Collins was to update and upgrade the ’90s house, and it included a small extension. It was completed last year, except for the landscaping, which is still under way.

That general contractor relied heavily on sub-contractors, she said, and sometimes they wouldn’t show, or would arrive days late, or did shoddy work and were fired.

Her remodel of an old family beach retreat in New England took a Sears kit home down to the studs. The completion date was June 2018, but it’s still not done because the contractor, who has been doing most of the work himself, is stretched and unattentive.

“He’d say, ‘I’ll be out there next week,’ and next week would turn into next month, and next month would be six months,” she said.

Current estimates indicate there are about 300,000 unfilled jobs in the construction industry, and the industry is expected to need an additional 747,000 workers by 2026, according to the U.S. Bureau of Labor Statistics.

An August survey of nearly 375 members of the National Kitchen and Bath Association found that almost two-thirds of the respondents said they had difficulties hiring skilled workers in the previous year, and nearly 70% felt the problem had gotten worse since 2016.

“Labor shortages have impacted start dates and completion dates on construction and renovation projects, with NKBA members citing delays on 30% of jobs,” said Bill Darcy, chief executive officer of the trade association.

A look at 15 different trades found shortages in them all, Darcy said in a telephone interview from NKBA headquarters in Hackettstown, New Jersey. And as with previous years, he said, one of the greatest needs was for carpenters, who do rough-in work and framing, and finish carpenters, who hang cabinets, do millwork, flooring and install molding.

Finding a quality finishing carpenter was one of the biggest frustrations in Osborne’s Fort Collins remodel.

“One guy got started on the basement and just left, so to find somebody to pick up where he left off was hard,” she said.

The seeds of the current labor shortage were planted during the Great Recession, when a lack of construction jobs prompted many workers to leave the industry.

“Not enough of them have returned to help us close the gap,” Darcy said.

Compounding the problem is the graying of the remaining workforce, with the median age for a construction worker at 42.5 years, according to January figures from the Labor Bureau. It’s estimated that for every five workers retiring from the industry, only one is entering it, said Silvia Lattoz, Governance and Global Relations Senior Manager at NKBA.

Younger people aren’t interested in construction careers because they think the jobs don’t pay well, are too dirty or physically demanding, or mistakenly think the jobs don’t use much technology, Lattoz said.

“There’s definitely some kind of stigma tied to this,” she said.

Players in the industry are ramping up efforts to address the impending crisis, launching incentives to try to recruit new workers, especially young people, to the trades.

The Home Depot Foundation announced last year it was committing $50 million to skilled trades training, with plans to attract 20,000 people by 2028.

“We want to bring shop class back, from coast to coast,” Shannon Gerber, executive director of the foundation, said in a release. The program focuses on supporting veterans, as well as underserved high schools.

Lowe’s last year started offering employees tuition and other incentives to train for jobs such as carpentry, plumbing, and appliance repair. More than 1,350 associates were enrolled in the Track to the Trades program this spring, Lowe’s spokeswoman Jennifer L. Weber said.

In April, Lowe’s and 60 of its suppliers and partners debuted a new program called Generation T , an online marketplace for jobs, apprenticeships and education programs in construction. It’s also on Twitter and Facebook.

“If we don’t fill the existing skilled trade gap, our businesses, homes and communities will suffer,” Weber said.

The National Association of Home Builders, meanwhile, sponsors student chapters in high schools and colleges . The clubs currently have more than 4,500 members.

The NAHB also supports immigration reform. Foreign-born workers were twice as likely to be employed in construction last year as workers born in the United States, according to the Department of Labor.

Legislation pending in Congress would try to ease the construction worker shortage by establishing a visa system to bring in more foreign laborers. Employers would have to prove they couldn’t find U.S. workers, and would have to pay fair wages based on local rates.

“Filling our workforce needs is a key component to boosting our workforce and our economy,” said U.S. Rep. Lloyd Smucker, Republican of Pennsylvania, a sponsor.

For a while at least, homeowners and home builders need to resign themselves to the fact that it will likely be harder to get work done, at least for a while.

Home Depot, for instance, said this year it was eliminating the service it had been offering that hired third-party contractors to install roofing, siding, insulation and gutters.

Projects are also likely to get more expensive, as nearly 60% of respondents in the NKBA survey said the shortage was affecting labor costs.

Osborne’s husband previously worked in the construction industry, but even so, she said, they suffered sticker shock when it came to their renovations.

“It’s that market right now,” she said. “You want something done and they throw out a big number, and I guess it’s a matter of, ’How badly do you want it done and how soon?”

Why the Nigerian Steel Sector is Crippled by Smuggling and Harsh Reforms

That the Nigerian steel manufacturing sector, arguably the most critical element in the nation’s industrialisation drive, is massively threatened by smuggling and racketeering is a development government should worry about.

The whole industrialisation exercise seems to be one big joke, not only because the Federal Government has grossly neglected the moribund steel sector for long, but also because illegal importation of steel flourishes in many parts of the country today, with little or no government intervention.   

The significance of an efficient and viable steel industry to any economy that takes manufacturing and its real sector seriously cannot be overemphasised. For one thing, it is fundamental to the industrial process and operations of many sectors of the economy, considering that literally, all the equipment used in production come from steel.

Just as steel is crucial in the industrial space, it is highly relevant in the domestic front as well.  Many home appliances and tools, ranging from electronics to things as basic as cutlery and kitchen utensils, not to mention building materials, have most of their parts fabricated from steel. Hence, it is safe to say that Nigeria’s pursuit of a meaningful infrastructural turnaround as a means of meeting its Millennium Development Goals might be a mirage after all.  

The scourge of steel smuggling 

A recent revelation by the Galvanised Iron and Steel Manufacturers Association suggested that Nigeria might be losing a whopping N53 billion to steel smuggling annually. A syndicate of saboteurs is alleged to import container loads of steel worth $5 million illegally into the country every week.  

Apparently, the smuggling and bootlegging activities are facilitated by the Nigerian Customs Service’s abandonment of a procedure called pre-shipment inspection, which ensures that goods imported into the country are meticulously examined at the point of entry. The development is a further dent on Nigeria’s ill reputation for rudderless border management and control. Consequently, the steel market is saturated with a great many substandard products illegally imported from abroad at the expense of locally manufactured ones. Consumers generally prefer the smuggled products to the local ones on the ground that they are cheaper, even though the latter is superior in terms of quality.  


How reforms are stunting local production 

It is worthy of note that hostile government policies are limiting the sector’s enormous promise. The high cost of local steel, interestingly, stems from outrageous tariffs imposed by the government on raw materials used in steel manufacturing. That in itself, is a major challenge manufacturers have had to confront with the passage of time. For instance, 35% tariff is currently charged on a cold rolled sheet, a critical raw material in fabricating roofing sheets and a couple of other products.  

For an industry that has suffered arrested development over the years, the current crisis suggests that a total sector collapse is imminent. Hordes of steel manufacturing companies are closing shop over dwindling patronage. The situation has also resulted in the retrenchment of thousands of employees in the sector in question. 

When asked about the smuggling activities and other developments in the sector, a top official of Ajaokuta Steel Company Limited, who spoke to Nairametrics on condition of anonymity, said, “Even if companies are not folding up, production will be down. The steel sector is at its embryonic stage. Steel consumption in Nigeria is very high.

Illegal importation is a flourishing business because of the high demand, and most of the steel that comes into the country is substandard. Illegal importation is a result of outright connivance of smugglers with customs officials.”  

He went further to identify Benin Republic and some West African countries as the places where most of the substandard goods come from. He blamed the factors responsible for this crisis on government and its policies. Equally lamenting the atrocious neglect of the Ajaokuta Steel Company and Delta Steel Company, the two major steel mills in the country, he said no meaningful progress could be recorded in the industry without resuscitating the plants.  

“The political will of the government is lacking. Obasanjo attempted to revive Ajaokuta in 2005 but he didn’t give it to competent hands. In 2008, Yar’Adua terminated the concession.”  


The way forward    

Our source further added, “We shouldn’t expect something significant to happen until government looks the way of concession or privatisation.”  To buttress his point, he reiterated a myriad of benefits Nigeria could reap from an active and efficient steel industry.  

“Imagine the impact that a project like the Dangote Refinery construction would have had on the steel sector and the local economy if all the steel being used had been sourced locally. Look at all the rail projects government is also doing in different parts of the country. Don’t forget also that everything in oil and gas requires steel.”  

For the sector to be transformed to a robust and efficient venture, the government must take effective measures against the rampant corruption in the Nigerian Customs Service and secure our borders, in order to gain the confidence of local investors. There is also an urgent need to review the steel industry reforms, particularly the downward review of tariffs on raw materials used in producing steel.  

Potential contributions of an effective steel industry to the Nigerian economy  

The opportunities and potentials in the Nigerian steel sector are diverse. The country currently boasts of over 2 billion metric tonnes of iron ore reserves, making it the country with the second largest deposit in Africa and the 12th in the world, according to a statement made by the Vice President, Prof. Yemi, Osinbajo in 2016.   

The industry is said to be capable of saving Nigeria at least $3 billion in foreign exchange every year if local manufacturing of steel is massively explored. KogiAbia, Plateau, KwaraNasarawa, Benue, Bauchi, and Anambra are among the states that have iron ore deposit in commercial quantities. Interestingly, industry experts have revealed that the first phase of Ajaokuta Steel Company alone can create about 500,000 jobs upon completion.

Source: nairametrics

7 Common Mistakes of Estate Planning

Even though planning your estate isn’t an enjoyable job it’s necessary so that you can efficiently and successfully transfer all of your assets to those you leave behind. With a bit of careful planning, your heirs can avoid having to pay unnecessary fees and federal taxes on your assets. As well, a well planned estate avoids confusion for your loved ones.

Still, with all the advantages of estate planning, many people make a great many mistakes in the process. The most common mistake when it comes to estate planning is not getting around to doing it at all. Make sure that you take the time to plan at least the financial portion of your estate so that you leave your loved ones behind with some amount of security. The following seven mistakes often put families into great difficulty after a loved one’s passing.

1. Don’t fall into the trap of thinking that estate planning is just for the rich. This is completely false as planning your estate is essential for anyone who has any amount of assets to leave behind. Many people don’t realize that their estate is as large as it really is, especially when they fail to take into account the assets from their home.

2. Remember to update your will and to review it at least once every two years. Factors that can change information about your beneficiaries include deaths, divorce, birth, and adoption. As your family structure changes so does the change in your assets and who you want to leave them to.

3. Don’t assume that taxes paid on your assets are set in stone. Talk to your financial planner about ways that your beneficiaries can avoid paying taxes on your assets. There are several strategies for tax planning so that you can minimize taxes or avoid them altogether.

4. All of your financial papers should be in order so that it’s easy for someone to find them. Make sure that one of your loved ones has information on where to find the papers necessary for planning after your death.

5. Don’t leave everything to your partner. When you leave all of your assets to your spouse you are in reality sacrificing their portion of the benefit.

6. Ensure that your children are well planned for. Many people take a lot of time deciding what to do with their assets and forget that they need to appoint guardianship for their children. There are many details to take into consideration when it comes to guardianship.

7. If you don’t have a financial advisor, get one. Financial Planners and Advisors are trained intimately in these matters and can provide asset protection well above whatever fees they may charge.

The above mistakes are common when people are planning their estate. Take the time to plan for your death even though you think that you have years before it becomes an issue. The key to successful estate planning is being prepared.

Source:  Boctrust Team

Miami Unveils Resiliency Plan to Tackle Affordable Housing, Traffic, Income Inequality

Miami is often seen as ground zero for the challenges climate change can create for a city. But that isn’t the only significant issue the region is facing.

Traffic and infrastructure, affordable housing and income inequality are just some prevalent issues the area is working to resolve. That’s why Greater Miami and the beaches have released its new resilience strategy, which aims to tackle every unique problem the area is experiencing.

Resilient 305 has been in development for the past three years with the City of Miami, Miami Beach, and Miami-Dade County crafting it  thanks in part to the funding of the 100 Resilient Cities program.

The program, which was created by the Rockefeller Foundation, aimed to improve resiliency across 100 cities around the world by creating a global network to discuss solutions for issues that plagued them. The program ends in July as many of the cities involved in the initiative have released resilience strategies like Resilient 305. In fact, Honolulu and Calgary revealed their plans the exact same day as Miami.

The newly unveiled plan contains a series of projects that address issues like sea level rise and coastal erosion, growing traffic congestion, infrastructure, affordable housing and income inequality.

Some of the immediate changes residents can expect from these projects in the coming year are the preservation and restoration of Biscayne Bay and an arrest diversion program for opioid users. However, better bus routes and an expansion of renewable energy may take a bit more time.

The ultimate goal of Resilient 305 is to recreate the network of 100 Resilient Cities – but on a local level. Twenty-five municipalities in the Greater Miami area (Key Biscayne and El Portal to name a few) have already signed up to be a part of the program. They will have access to all the research and tools the Rockefeller Foundation provided over the last three years.

They will also be required to take multiple training courses in order to make sure they can properly identify and fund projects that address their local issues.

Miami-Dade County, the City of Miami, and Miami Beach are currently the model municipalities in the program, as many local projects that address challenges in the area are currently being carried out.

The City of Miami is currently improving its pump stations to address flooding caused by storms and rising tides. At the same time, the city is launching an affordable housing project to address its issues of income inequality.

“All the data analysis shows our wage growth is not growing on par with our population growth,” City of Miami Mayor Francis Suarez says. “We’re number seven in population, over a hundred in GDP per capita, and two hundred and sixty in per capita growth.”

The affordable housing master plan aims to create and preserve 12,000 affordable units by 2024.

A Place the Entire Family Can Call Home

Every Thursday, Henk and Elly Oving take care of their young grandchildren. They don’t have to travel far. They just go downstairs.

The Ovings share a five-story home in Amsterdam — two apartments stacked on top of each other and joined by a central staircase — with their daughter Jantien and her husband, Auguste van Oppen.

“It’s two fully independent houses that are intertwined with one another,” said Mr. van Oppen, an architect who could just as easily be describing the 4,900-square-foot home’s two households.

The van Oppens and the Ovings are among a growing number of families sharing multigenerational residences. From Amsterdam to Australia, architects like Mr. van Oppen and his team at BETA, the local firm he co-founded with Evert Klinkenberg, are designing striking homes that make cross-generational care for aging baby boomers and overworked parents as easy as a walk down the hallway.

In a home in Amsterdam called the 3 Generation House, two apartments are joined by a central staircase.CreditOssip van Duivenbode
“It’s about being there together,” said Mr. van Oppen, who designed the home along with Mr. Klinkenberg. “It’s about being there for one another.”

The trick is coming up with designs that incorporate privacy, senior-friendly spaces and flexibility for the future. At the same time, the concept can help address one of today’s more stubborn issues — housing affordability.

Multigenerational homes allow family members to maintain their independence while benefiting from interdependence.

In the 3 Generation House, as it is called, the van Oppens opted for the 1,750-square-foot lower level to take advantage of direct access to the garden for the children, while the in-laws, retired and in their 60s, chose the 1,870-square-foot upper level with an elevator. “We wanted more privacy and the roof terrace,” Mr. Oving said.

Including subtle details like wider doorways and level, uninterrupted floors, their apartment has been designed to be senior-friendly — but discreetly so.

“It doesn’t look like a senior apartment, but it is,” Mr. van Oppen said.

Similarly, in Helsinki, the actors Vilma Melasniemi and Juho Milonoff built House M-M, a three-story home that includes a ground-floor apartment for Mrs. Melasniemi’s grandmother.

“We had long conversations about degrees of privacy,” said Tuomas Siitonen, who designed the timber-clad home, “so they could all live quite close to each other, and the grandparents could take care of their kids, and they could take care of the grandmother, but still everyone could live their own lives.”

The house is on land owned by Mrs. Melasniemi’s parents, who still live nearby in the 100-year-old home where she grew up.

The fully accessible 270-square-foot ground-floor apartment, which was financed by Mrs. Melasniemi’s parents, includes its own entrance and sheltered outdoor space. There is also a common garden area that can be shared by all members of the family.

“When we were building the house, I asked my father to draw the line on paper: Which is the land that we pay for, which is our common space and which is the land of their house,” Mrs. Melasniemi said. “I liked that he made it, as he knows the garden and he knows what he likes to think is their space.”

Mrs. Melasniemi’s grandmother, who was 91 when she moved in, has since died.

“My father got the opportunity to visit and talk to his mother every day,” said Mrs. Melasniemi, who has two children.

But the home is already being used for another phase in its planned long life.

“We discussed the kind of life span of the house,” Mr. Siitonen said. “We thought of how they could use the space when the kids move out, and then when the grandmother passes away. And of course, in the future the parents, one or both of them, might move in there. So it was kind of like we thought of things in five years and 10 years and 50 years.”

As with the 3 Generation House, which was designed to allow for expansions and conversions as the family evolves, House M-M was designed so that the children’s rooms, on the second floor, could be combined. Mrs. Melasniemi and Mr. Milonoff could then move down and turn the spaces on the upper floor into a studio. “And then maybe one of the kids could move into the apartment where the grandmother used to live,” Mr. Siitonen said. “Now it’s rented.”

In Kent, England, Caring Wood is another multigenerational home built with the future in mind. Commissioned by the in-laws of the architect James Macdonald Wright, of London-based Macdonald Wright Architects, it was designed by Mr. Wright and Niall Maxwell, of the firm Rural Office for Architecture, as a country house for the 70-year-old couple and the family’s three daughters and seven grandchildren. “There’s 15 of us,” Mr. Wright said. “The idea really was that we would all spend as much time as possible there.”

Set on 84 wooded acres, the family home takes a pinwheel shape with four corner apartments, one per family.

These are connected to the home’s common spaces, including a central inner courtyard where a family tree cast in glass by the artist Colin Reid sits in the center of the courtyard’s shallow pond.

The shared courtyard of Caring Wood, designed by James Macdonald Wright and Niall Maxwell, of the firm Rural Office for Architecture.
“Internal walls are all partitions, so they can be reconfigured,” Mr. Wright said. In terms of lifetime use, he said, “there is a lift that gives access to all levels of the house.”

While privacy is built in, Mr. Wright said the children, ages 3 to 17, have no qualms about breaking it down. “They kind of just charge in between all of the individual apartments,” he said.

In Torekov, Sweden, a coastal village north of Malmo, the firm Maka Arkitektur designed a multigenerational weekend home for a mother and the families of her three children, currently including three grandchildren.

“Torekov has always been a kind of generational meeting point for the entire extended family,” said Daniel Hedner, the home’s architect along with Ylva der Hagopian.

In Torekov, Sweden, the firm Maka Arkitektur designed a multigenerational weekend home for a mother and the families of her three children. It has a main building with two wings and a semi-detached guesthouse set around a shared courtyard.

In Torekov, Sweden, the firm Maka Arkitektur designed a multigenerational weekend home for a mother and the families of her three children. It has a main building with two wings and a semi-detached guesthouse set around a shared courtyard.

Forming an outdoor courtyard that serves as a connecting social space for the family, the 1,740-square-foot home comprises a main building with two wings.

A slightly detached 280-square-foot guesthouse has its own kitchenette and bathroom.

“Access to separate rooms, nooks and corners for privacy are essential in multigenerational houses,” said Ms. der Hagopian, Mr. Hedner’s associate, “as well as generous social space that can gather a lot of people.”

Though large families living together is not a new idea, and mother-in-law apartments are common in many places, purpose-built multigenerational homes are largely “a new phenomena in Western society,” Mr. van Oppen said. But they have a strong tradition in Asian society.

That figured into the thinking of a couple with Asian roots who commissioned Charles House, a multigenerational home in Melbourne, Australia. “For them it was kind of a natural way to have a house,” said Andrew Maynard, whose firm, Austin Maynard Architects, designed it.

For this project, Mr. Maynard turned the traditional Australian “granny flat” (normally akin to a shed out back) on its head by incorporating it into Charles House as an adaptable space on the ground level. Although multigenerational homes are not typically part of Australian culture, Mr. Maynard said the country could certainly benefit from them.

“Sydney and Melbourne are among the top 10 of the most unaffordable cities to own a home in the world. And there’s a whole generation of younger people, millennials, who just can’t even buy into the market,” he said.

Source: nytimes

Foreign Money Still Driving B.C. Housing Market Despite Ownership Data: Expert

Most homeowners in British Columbia’s hot housing market live in the province, but one expert says that doesn’t mean foreign money isn’t to blame for high prices and speculation.

Of the 2,156,920 residential properties in B.C, 5.5 per cent were owned by foreign individuals or foreign non-individuals such as non-individual a corporation, trust or state-owned entity, according to the Canadian Housing Statistics Program from Statistics Canada.

Josh Gordon with the Simon Fraser University School of Public Policy says the study only looks at someone’s residency, not where they got the money to buy the property.

“The CHSP data looks at the stock of housing, not necessarily the flow of housing market participation,” Gordon said. “There’s been a misuse of the word domestic (speculation) because the data is about residency. If a resident is using foreign money, then that can’t be chalked up to domestic factors.”

He said even those B.C. residents who are speculating on housing may be relying on foreign participation in the market.

“Are they speculating on the arrival of substantial amounts of foreign money and ownership? If that’s the case, then just because there are a lot of domestic speculations does not change the fact that the overall market is being driven by the impact of outside money.

Gordon says if that’s the case, then foreign money could still be driving the market even though only five per cent of homes are officially owned by foreigners.

“If that’s the case, then just because there are a lot of domestic speculators, does not change the fact that the overall market is being driven by the impact of outside money.”

He points to the slow down in the housing market, particularly in the Vancouver-area as the province introduces policies to curtail the flow of foreign money and as capital controls are controlling the money arriving from China.

“Policy has been on the right track on the provincial level,” he said. “The market has slowed down and prices are starting to fall as we would expect if we thought the major issue was foreign ownership.

Source: citynews1130

Hey, Middle Class, the Housing Crisis is Coming for You Next

Charlotte, North Carolina, one of the Southeast’s biggest cities, is short 34,000 affordable housing units. A booming job market has attracted 100,000 new households to the city since 2000, and supply hasn’t kept up with demand.

In Salt Lake City, Utah, there are more families than available places to live, a shortage of about 54,000 units. It’s the most severe manifestation of pricing pressure in a state where housing costs can run higher than both Las Vegas and Phoenix. This deficit comes after a year when Salt Lake City led the nation in homebuilding.

In Columbus, Ohio, the housing market has cooled after ever-higher prices exhausted buyers who simply can’t keep up with rising costs.

“The sweet spots are still a challenge, but there’s no sweet spot in the high end,” Andrew Show, a local realtor, told the Columbus Dispatch.

Three of the nation’s fastest-growing cities, all far from the craziness of real estate in coastal markets, all building at a relatively speedy clip, and all with popular neighborhoods, boasting year after year of rising prices, have become too expensive for a greater number of potential owners and renters.

When policymakers and pundits talk about the nation’s affordable housing crisis, they usually talk about the forces that deny low-income Americans reliable and accessible housing near better jobs and educational opportunity. And they should; it’s not just a national crisis and widespread policy failure, but a moral crisis for the world’s richest nation.

But new research shows that the shocking realities of the nation’s affordability crisis—8 million renters pay more than half their income on rent, and the country is short 7.2 million affordable housing units, according to the National Low-Income Housing Coalition—have begun to metastasize and impact the middle class.

A new paper by Jenny Schuetz, a housing policy fellow at the Brookings Institution’s Metropolitan Policy Program, found that some of the severe affordability issues impacting low-income Americans have crept into the lower-middle class and, without action, will get worse.

In “Cost, crowding, or commuting? Housing stress on the middle class,” Schuetz looked at census data to find the impact of a decade when housing costs rose faster than average incomes.

Her nuanced conclusions suggest that, on an aggregate national level, there isn’t a middle-class housing crisis. High-cost metros like Seattle and San Francisco unquestionably have challenges, and, of course, low-income households are stretched like crazy. But it depends on how you look at the data.

If you break down the nation into five income groups, the crises faced by the fifth group—or the lowest-income—are increasingly being seen within the fourth group, the lower-middle class. The fifth of the country with the lowest income spends 60 percent of their money on housing, while the next-lowest fifth spends 40 percent, both significantly higher than the 30 percent recommended by economists.

“The issues facing low-income Americans are now showing up in lower-middle-income Americans, and I think that’s something we should worry about,” says Schuetz. “It’s a national pattern. That group is spending more money on rent everywhere, in Cleveland and not just in California.”

Other studies point to a similar kind of strain. Research from Berkadia, a Berkshire Hathaway company, found that the lower-middle income bracket, which it qualified as earning $35,000 to $49,999 between 2012 and 2017, has been hit hard, with 6 percent growth in rent-stressed families during that time period. Cities like Tulsa, Oklahoma, and Omaha, Nebraska, have become challenging for renters, with 40 percent or more of families identifying as rent-burdened.

It’s easier to focus on the extremes of the housing shortage, both the rising levels of poverty and homelessness and the seven-figure spec mansions of the tech jet set. But the creeping cost of housing is pinching a middle class already struggling with flat wages, rising child care costs, and the skyrocketing price tag of a four-year college degree.

This “middle-class squeeze,” as a 2014 report by the Center for American Progress illuminated, was about new constraints, and how “the costs of key elements of middle-class security rose by more than $10,000 in the 12 years from 2000 to 2012, at a time when this family’s income was stagnant.”

Housing unaffordability isn’t the cause of the crisis, per se. But with the cost of everything else rising, it’s not surprising that formerly stable families feel squeezed by even slight increases in housing costs, and that overall growth is hampered by a middle class barely able to pay the bills and put their kids through school.

Aren’t we already in a crisis?

Middle-class Californians, many of whom have recently moved to other, more affordable, areas in the West, like Boise, Idaho, and most new homebuyers looking to buy in the nation’s largest cities, would probably tell you there’s long been an affordability crisis across the income spectrum.

And it’s an issue that’s grown over decades: According to a 2017 report done by the St. Louis Federal Reserve Bank, the median price of single-family housing in the U.S. outgrew the rise in median household income by 390 percent between January 1986 and July 2017.

Schuetz’s analysis for Brookings found that lower-middle-income renters and homeowners continue to be forced to make the traditional trade-offs, sacrificing a combination of cost, commute time, and home size for proximity to big-city job markets. It’s all part of the agglomeration crisis, the clustering of jobs and opportunities in specific metros.

What Schuetz has identified as a newer aspect of the problem is the decision by city governments to cut back on housing production via restrictive codes and zoning, which only drives up land prices (the Lincoln Institute of Land Policy found that the cost of land skyrocketed by 76 percent from 2000 to 2016). Big, productive, and progressive cities have hampered their housing supply with very deliberate policy choices.

“Waving our hands and saying we can’t do anything to fix it gives a pass to local government who have made very bad decisions,” says Schuetz. “As the cost burden of housing keeps inching its way up the income spectrum, if we don’t see that as a problem and change the housing delivery system, it will become a middle-income crisis in more widespread terms.”

If this is what the housing market can produce in a good economy, what will happen to homebuilding if we fall into a recession? A report from the Kansas City Federal Reserve Bank found that during the last 10 years of economic expansion the annual rate of single-family home starts was 25 percent below ’90s levels. The current rate of construction relative to the number of households is at its lowest levels since the ’50s, the earliest date at which this kind of reliable nationwide data is available.

Schuetz believes cities need to ramp up affordable housing production. Will newly rising metros like Denver, Austin, and Nashville act in time to stem rampant price inflation? Or will they fall into the same trap as other, larger metros?

There are also increased calls for state-level intervention, to overrule failed policies at the local level. The repeated, and so far unrealized, push for SB 50, California’s transit-oriented zoning bill, as well as the successful passage of statewide rent control in Oregon, demonstrate the public’s hunger to have governors and state legislatures step in and use the tools at their disposal to put pressure on local governments.

“Local governments have no incentive to change, and actually have incentive to dig in their heels on these issues, so ultimately, I think that’s going to require probably state intervention, like withholding funds,” says Schuetz.

Without some kind of relief on the horizon, the middle class will be locked out of many areas due to housing strain. And like all Americans suffering from the affordability crisis, they’ll lose out—a loss for the entire country.

“The highest-opportunity neighborhoods have become gated communities, and you can’t move in unless you’re a millionaire,” says Schuetz. “To the extent that high housing costs discourage anybody from moving to a place to find a job, have new ideas, and contribute to a society, we should worry about that. That’s fundamentally damaging to opportunity, and that’s going to hurt the vitality of our most productive regions.”

Source: curbed

Namibia: Govt Tightens Control Over Urban Land Ownership

The government will introduce strict verification mechanisms to control the ownership of residential land in informal urban areas.

The director for land reform and resettlement, Peter Nangolo, said the government will not allow people to own more than one primary residential property in the high-density urban areas under the new flexible land tenure scheme.

He made these remarks on Monday when he announced that the government had started implementing the flexible land tenure scheme in urban areas.

The scheme was introduced after recommendations of the second national land conference last year, which directed the government to implement the Flexible Land Tenure Act No 4 of 2012, aimed at providing secure land rights to people living in informal settlements.

The scheme is aimed at formalising the informal settlements to provide security of tenure to residents.

According to Nangolo, the scheme will create two land titles, which will enable people in informal settlements to acquire loans from banks to build their houses.

These are the starter title and the landhold title. The two land titles can be transformed into a freehold title, provided all the families living within a block of erven agree to the upgrade.

The meeting was also meant to provide the banks with information on the creditworthiness of the scheme, and of the liquidity of the titles.

Nangolo said the scheme was being implemented at four informal settlements of Onyika and Freedom Land B, both in Windhoek; Onawa at Oshakati; and Freedom Square at Gobabis as a pilot project.

He said if the project succeeds, the ministry will roll out the project to all local authorities in the country.

Although the proposed scheme is aimed at benefiting low-income-earners and people with no formal employment, The Namibian reported this year that there were some people who owned houses under freehold titles in the upmarket suburbs of Windhoek, and also owned structures in informal settlements.

Windhoek mayor Muesee Kazapua told a meeting at State House this year that the municipality has records of some “so-called elites” who owned shacks, and have people renting them.

Nangolo said the ministry will ensure that people do not benefit from the scheme more than once, adding that people owning property under the freehold system are ineligible to benefit from the new scheme.

“Land in the informal settlements does not belong to individuals. You are there informally, you are there with nobody’s permission; the land belongs to the local authority. You just erected a structure there.”

“We will simply ask you to leave because it is not your land. We want to give this land to people who, after strict verification, are found not to have any other residential property elsewhere,” he stressed.

Representatives of several financial institutions who attended the briefing, however, raised concerns over the risks they might be exposed to through lending money to beneficiaries of the scheme.

Standard Bank’s head of property valuation, Fannie Bernard Jasi-Kanyemba, said banks need security that if beneficiaries fail to pay back the loans, the bank can take the land as collateral.

However, in this case, the land remains the property of the local authority, unless it is upgraded to freehold title status.

“For us to be able to finance the houses, some of the land needs to be serviced and be used as collateral because the bank is basically taking a risk, and the beneficiaries need to meet certain criteria to qualify.

“Be that as it may, we are quite mindful that some of these people do not even have an income or formal employment,” Jasi-Kanyemba added.

A representative of Nedbank Namibia, who refused to be identified, said it was a big risk for banks to finance houses under the scheme, given the changes in High Court rules that prohibit banks from foreclosing primary residential property as the first option to recover debt if people default on loans.

“We don’t want to foreclose people’s properties. All these properties would be used as primary residences. Nobody wants foreclosures on them. We are saying we have given people title, but that is not the only thing banks consider when lending people money,” the representative stated.

Source: allafrica

CBN Reacts to Exchange Rate Policy Change, says Naira Not “floated”

The Central Bank of Nigeria (CBN) has finally responded to the report of change in Nigeria’s exchange rate system, dismissing the report that naira has been “floated”.

According to information obtained on the Central Bank’s twitter handle at the early hours of Wednesday, the apex bank stated that “NO change” has been made on Nigeria’s exchange rate structure.

Also, contrary to the central bank’s homepage on Tuesday which stated that the official rate was “market-determined”, the bank quickly reverted back to its original form on Wednesday, by providing details of the official bank exchange rate value.

What you should knowNairametrics first reported on Tuesday that CBN may have accepted to float the exchange rate, judging from the information contained on the Bank’s website. The website has reflected this change since May, leading some analysts to opine that the CBN may have surreptitiously decided to float the naira.

As stated earlier, Nigeria operates multiple exchange rates structure, with the Central Bank’s official exchange rate currently selling for N306.95/$1. However, that is just the official bank rate which most Nigerians and businesses do not access.

Hence, the parallel market (bureau de change) is the most patronized for individuals, travellers and even businesses. In the parallel market, price is specifically determined by market forces of demand and supply.

Meanwhile, the CBN established the Investors’ & Exporters’ FX (I&E) window in 2017, a continued effort to deepen the foreign exchange (FX) market and accommodate all obligations.

A twist in the news on FX:  The Central Bank has quashed report of floating naira, but this may be a signal the CBN is trying to test run the possibility of floating the naira. On Tuesday, a new exchange rate was introduced at the Nigerian Ports. Analysts are of the opinion this may be another FX window in view.

The new exchange rate was reportedly introduced at the Lagos Port and the Nigeria Customs Service (NCS) was said to have commenced immediate implementation. Sources disclosed that all transactions and cargoes that were cleared at the port on Monday were already paying N326 per dollar.

Reactions: Nigerians on Twitter have reacted to the purported move by the Central Bank to have floated the naira.

Source: nairametrics

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