Housing Micro-finance: Solution to Uganda’s housing deficit

Encouraging signs are emerging that the free market can be part of a housing solution for low-income communities. East Africa, like the rest of the continent, is in the grip of rapid urbanization. Populations are growing and the numbers moving into cities are rising even faster.

As a consequence, the amount of inadequate housing is increasing significantly. Poor housing affects every aspect of life. It is bad for health. It limits people’s ability to earn a living and their children’s capacity to learn. Housing low income households is a momentous challenge for everyone, whether in government, finance or the non-profit sector.

According to Ministry of Land, Housing and Urban development in Uganda, Uganda has a housing deficit of about 2. 4 million units. Other studies put Kenya’s shortfall to about 2 million. How will this gap be filled? The provision of public housing is virtually non-existent and the mortgage market simply doesn’t work for the vast majority.

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Reliable prospects

Most families are simply not viewed as reliable prospects by the banks. Even if they were, they might find it difficult to produce the required title deeds for a property. Strict building codes and requirements make even the cheapest houses purchasable with mortgages difficult for low-income borrowers to access. However according to new study findings, Habitat for Humanity believes the answer or solution to this is to take existing micro-finance methods and apply them to housing.

An initiative undertaken in Kenya and Uganda by Habitat’s Terwilliger Center for Innovation in Shelter and the MasterCard Foundation has shown that families or individuals earning as little as US $50 per month can successfully borrow money to build, extend or renovate their home.

Ordinarily, they would be excluded from banking and financial services. The Building Assets Unlocking Access project however opens the door, by offering incremental loans for incremental improvements.

Unable to borrow a large amount up front, a family can for example borrow 5 million shilling over 18 months to lay the foundations of a home. Once that is paid off, they might borrow a similar amount to complete the walls. Within two to three years, they would have moved from a shack or cramped single room to a properly constructed house. In Uganda housing loans are now available at banks such as Centenary Bank, Opportunity Bank, Pride Micro-finance and others.

Affordable houses

It is all about being small scale, affordable and lending responsibly, and it is working. The six local financial institutions that participated in the project report that their housing micro finance portfolios are often performing better than their general loan portfolios. In other words, they are making money. Indeed, there is a business case for housing micro finance.

Since 2015, about six institutions in Uganda and Kenya have lent $33 million to more than 42,000 households, benefiting 210,000 individuals. Among them is Jane in Kenya, a single mother of three. Forced to leave her father’s compound when he remarried, she began renting rooms at a crowded shopping area in Machakos, 40 miles from Nairobi.

A businesswoman, she operated a school canteen and sold seeds, but was desperate for her own place. She applied for a 200,000 shilling (About 7 million Uganda shillings) from the Kenya Women Microfinance Bank Ltd to start building her own home. The house was ready to occupy by May 2016, though not completely finished. She plans to continue developing her business, so she can repay the loan. Jane says the biggest benefit of her home is that she now feels like a “strong woman”.

More than 35,000 clients have taken up the Nyumba Smart loan from the same bank in the last two years. In the past decade, just 23,000 have taken out conventional mortgages with the bank. Janes story is similar to thousands of other women and men who are accessing housing loans in Uganda and are able to finance them using their low incomes.

For the banks providing these services, the leverage has been great. The project’s success gives us real conviction that it can be replicated elsewhere, with self-financing versions taking over before too long. We continue to encourage all stakeholders but particularly micro-finance institutions, to embrace the concept of housing micro-finance. We believe it is the world’s best bet to improve access to stable housing for low income people in the developing world on a meaningful scale.

SOURCE : constructionreviewonline.com


Exima realilty to build future dream homes

..Focuses on retail, small-size residential units for the residential time buyers

It was all excitement in the property market last Thursday as Eximia Realty Company Limited made a bold and ambitious entry into the market, determined to ride the current and build future dreams today.

Out with a vision to become Africa’s pace-setting property company by creating real value for its customers, and investors, Eximia aims to build these future dreams through innovative, value-driven and customer focused real estate solutions.

Eximia was conceived as a real estate company that will ‘lead the world through Africa’. The overall objective is to re-define the narrative by challenging the status quo and creating a unique and innovative platform to deliver real estate solutions in Nigeria and eventually Africa.

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It is a real estate company that focuses on creating a unique and innovative platform to deliver real estate solutions with special interest in the retail segment of the market. Eximia has made a promise to provide 5, 000 units of singe and two -bedroom apartments in the next five years.

The launch of the  company which was tagged ‘Real Art meets Real Estate’ started with an art exhibition by leading exhibitors in the country and was witnessed by high profile people in society. “Our unique offerings are targeted primarily at the mid-tier market, especially first time home buyers, with two projects currently in the category that are set for launch in Lekki by November”, explained Hakeem Ogunniran, the CEO of the Company limited.

Already the company is developing two projects in this category. These are the Lawton Park which offers 64 apartments comprising studios, 1 and 2 bedroom flats, and Maestroville which offers 42 apart-ments comprising studios, 1 and 2 bedroom flats.

The two projects boast facilities and amenities that include communal lounge, 24 hour power supply, children playground, gym, laundromat, sewage/water treatment plant, CCTV/controlled access/security, Wifi/hot spots, etc.

Expectation is high from Eximia because Ogunniran, who is the immediate past managing director of UAC Property Development Company (UPDC), will be bringing his rich experience and success streaks that made UPDC the real estate market leader to bear on the running of this young company.

According to him, Eximia has chosen to focus on studio, one bed-room and two bedroom apartments because lots of real estate decisions drivers cater to this category of the market. “We are committed to promoting the ideal of sustainable development and creating a perfect harmony between the environment and our deliverables,” Ogunniran assured.

Eximia is also a joint developer of The Mews at Katampe, Abuja, Genesis Commercial Park in Opebi Ikeja, and a joint promoters of the new Lake City in Lekki. Lagos.

Nike Akande, chairperson of the NEPAD business group in Nigeria and special guest at the launch, said she was driven by the passion to see businesses that spring up in Nigeria grow and develop into sustainable brands.

Source: businessdayonline.com

Affordable Housing Is Not About Flats-Alex Awiti

In this article Dr. Alex Awiti (founder and director of the East Africa Institute at the Aga Khan University in Nairobi), takes an in depth look at the issue of affordable housing in Kenya and goes beyond just the architecture or design of it and dives into the urbanism and policies that needs to guide it.

He cites what he describes as “unwieldy, rogue urbanization” as a chief culprit in Kenya’s housing crisis, highlighting a lack of synergy between land use planning, infrastructure design and efficient governance.

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Few issues are more important to the developing world than the provision of affordable, safe and livable housing. Many scholars now believe that Africa is in the throes of a housing crisis. With Africa’s population expected to reach 2.4 billion by 2050, small towns, medium size towns and mega cities will be stretched beyond breaking point due to inadequate housing and associated infrastructure such as water and sanitation, schools, open spaces and public transit.

The 2010 Constitution establishes the right to housing as an enforceable socio-economic right. But a majority of Kenyans lack access to affordable and decent housing. For example, households that live in rental housing spend about 47 per cent of their income on rent and associated costs. Moreover, 61 per cent of urban households live in slums such as Mathare and Kibera.

The supply of new housing units is currently estimated at 50,000 annually. Kenya’s housing crisis is exacerbated by an urbanization rate of about 4.2 per cent, which means that we add about 500,000 new urban inhabitants annually who need decent homes, not slums. President Uhuru Kenyatta has an ambitious plan to add one million houses annually over the next five years. Although details are scant, Kenyatta seeks to mobilize diverse sources of financing and leverage private sector partnership to provide affordable housing across the country under his Big Four Plan. The government will make land available by appropriating parcels from state corporations such as East African Portland Cement, the Kenya Broadcasting Corporation, Kenya Prisons, the Ministry of Agriculture and perhaps the Kenya Railways Corporation.

Kenya’s housing crisis is inextricably linked to land use planning, especially in urban areas. The urban housing crisis has everything to do with unwieldy, rogue urbanization. In the past decade, large infrastructure investments have fuelled virulent speculation, distorting land and house pricing, and urban spatial form. Moreover, our inability to link land use and urban planning to road infrastructure design and development has led to the emergence of suburbs that lack basic amenities and have now made our cities and towns disconnected, crowded and costly.

Decades of inattention to land use planning and urban and municipal governance has not only brought Africa to the cusp of a housing crisis, it has destroyed our sense of community living. We no longer think of our neighborhoods as places that meet in close proximity, basic life needs such as schools and safe recreational spaces for our children, places of worship, healthcare, business and commerce and, yes, jobs and efficient public transit.

President Kenyatta’s focus on affordable housing provides an opportunity to rethink the structure and form of Kenya’s rapid urbanisation and to reorganise the vast and unplanned rural land. Affordable housing must not be about rows upon rows of stacked up apartment units on cheap land in places such as Kitengela, Kajiado and Mavoko. Affordable housing must be about holistic, economically vibrant, socially cohesive communities that are part of thoughtful urban and rural design, which connects households, and especially youth with decent jobs.

SOURCE: The Star Kenya




1000 homeowners underway as A/lbom, FHF build for workers


The housing shortage in Akwa Ibom State will be reduced significantly and some families taken off the housing market as the state government in collaboration with Family Home Fund perfect plans to build 1000 housing units in five local government areas of the state.

The benefiting local government areas are Uyo, Eket, lkot Abasi, Onna and Uruan. Given an average of four persons in a family comprising father, mother and two children, it means that, cumulatively, about 4,000 persons will be living in their own homes in these local government areas when these houses are completed and delivered to the beneficiary-workers. Authorities of the state government told us that, in addition to the 1000 housing units, the state government has also acquired a parcel of land for a luxury estate that will deliver 555 units of houses in Uye, the state capital.

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Ime Ekpo, the state commissioner for lands and housing, explained that the state government’s partnership with Family Home Fund on this project was to ease housing shortage in the local government areas, noting that people were moving to those areas because of increased economic activities.

“These are areas that people are moving into.  We want to increase the housing stock for the people and we want civil servants to have their houses before retirement,” he said.

Ekpo disclosed that 50 hectares of land had been acquired for the state government-owned Akwa Ibom Property and Investment Company (APICO) for civil servants only, saying that the housing units would be completed within six months.

The commissioner lamented the distortion in the master plan of the state capital which, according to him, has resulted in flooding within the city centre, revealing that a committee has been raised to bring down all illegal structures including churches as part controlled development in the slate capital.

Source: Anifiok Udonquak

Who should be able to afford ‘affordable’ housing?

After several attempts to buy his first home, Jason Cooper had given up. He’d put down what he thought were “reasonable” offers on modest houses in New Zealand’s capital, Wellington, only to be outbid by what he said were shocking margins.

He took a job in Auckland, but then found himself in the centre of the country’s most bloated property market, where the average house price is more than one million New Zealand dollars ($678,000). Cooper consigned himself to a life of renting.

“I am still shocked that, at the age of 33, in a professional job as a lawyer, I can’t afford a house,” he says.

It is a common refrain in New Zealand, where only a quarter of people aged 40 and below own their own homes – compared to half in 1991. The decline of millennial homeownership is a global trend, and commentators have been quick to blame millennials’ different financial priorities – such as frivolous spending on avocado toast – for their lower rates of property ownership.

But the reality is more complicated, including in New Zealand, where a chronic undersupply of homes has driven housing unaffordability to rank among the highest in the developed world.

If you build it, they will buy

This month a group of excited first-time home-buyers moved into 18 new houses in Auckland. Unlike Cooper, they had been able to secure properties for purchase – but had done so on the back of a government scheme.

The programme, KiwiBuild, gave them the chance to buy property for a fixed sum, and shut out investors who drive up prices out of reach. Until they had heard their names pulled from a ballot of hopefuls, many of these young professionals had abandoned hope of footing it in the million-dollar property market of New Zealand’s largest city.

KiwiBuild has sparked a debate, however, which has resonated globally. Leaders of some of the world’s least affordable cities, including Sydney, Hong Kong and London, have wrestled with the meaning of ‘affordable’ housing, and what a government’s housing priorities should be: finding homes for its poorest citizens, or catering to low-middle income earners who can afford to rent – but not to buy.

Facing high rates of homelessness, unaffordable rents and long waiting lists for public housing, New Zealand’s centre-left government has, in the year since it took office, set out an ambitious agenda to tackle all of the country’s housing woes nearly simultaneously.

The tall order is partly why the KiwiBuild scheme – which has included a government pledge for 100,000 affordable new homes for first-time buyers in the next decade – has already proved controversial. The government’s political opponents, and critical pundits balked when the first recipients of the fixed-price, unsubsidised homes revealed themselves to be a soon-to-graduate medical student and a marketing manager. Critics argued that the houses, and the wide range of incomes allowed to apply for them, showed KiwiBuild was little more than middle-class welfare.

Fixed or broken?

State interventions to put first-time home ownership within the reach of low-to-middle income buyers are not unusual. Britain’s Help to Buy programme, for example, allows interest-free government loans to partly cover the cost of a property. In the United States, subsidy programmes for first-home buyers are also common.

Subsidy programmes often face criticism, however, that they drive up prices and still only benefit those who can almost afford a home, although a report produced for this year’s budget about Help to Buy said it had been successful in generating new houses that would not have otherwise been built.

But New Zealand’s model for KiwiBuild is different because those buying the homes do not receive government subsidies to help them put down a deposit or service a mortgage. The government doesn’t pay for construction of the homes, either. It merely guarantees to developers that a certain number of properties will be purchased at a fixed price, giving them the security they need to proceed with construction projects.

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The fixed prices, which vary depending on location, are meant to prevent the bidding wars that have locked out so many buyers. In Auckland, for example, homes cost between NZ$500,000 ($338,000) for one bedroom and NZ$650,000 for three bedrooms.

KiwiBuild homes can only be sold to those who make less than the specified income cap: NZ$120,000 NZD ($81,000) for sole buyers, and NZ$180,000 for couples. But these figures have also caused controversy. The median New Zealand income was $NZ41,200 last year, and the average household earned $NZ105,719. The average is lower for people in their 20s, who earned less than every other age group except teenagers and retirees.

“In the current format, KiwiBuild doesn’t actually do a great deal,” says Shamubeel Eaqub, an Auckland-based housing economist. “The government goes to the market and buys houses that would have been built anyway, and then it gives them to people who qualify on a few criteria. You can’t earn huge amounts of money, but you can earn a fair bit of money.”

But Eaqub says simply reducing the income cap wouldn’t work, because the cost of building homes is currently so high in New Zealand that the government would then struggle to find enough buyers who could afford KiwiBuild properties. Although he has hopes about innovative future plans for KiwiBuild, which is scheduled to include components of urban regeneration beginning in 2020, Eaqub is sceptical about the project’s efficacy.

For now, he says, no one has “been able to describe, to my satisfaction, what KiwiBuild will actually do”.

A saviour?

However controversial, KiwiBuild may rescue Jason Cooper from the purgatory of eternal rent. He earns less than the KiwiBuild income cap, and this week, he found out his name had been drawn from the ballot for an off-the-plan apartment to be built in the Auckland suburb of Onehunga.

But it is still not cheap.

If Cooper proceeds to the final stage of the sale, he will pay $NZ535,000 ($361,000) for the one-bedroom apartment, including a carpark – essentially market rate for the area. He will also have to front up the $NZ55,000 deposit, and service the mortgage, on his own.

As part of KiwiBuild programme guidelines, Cooper will also not be allowed to sell the property for three years – a rule intended to stop buyers from immediately flipping the houses for capital gains. These restrictions are causing some commentators to question why a first-home buyer would go for a KiwiBuild at all.

For Cooper, however, the answer is simple: with a KiwiBuild home, he says, he could not be outbid by property investors as before, and he felt more comfortable trusting a developer when the government was responsible for doing due diligence on the project.

According to New Zealand’s housing minister, Phil Twyford, people like Cooper were exactly who the programme was meant to help.

“We’re not apologetic that young professional couples, who are locked out of the housing market, are going to get a chance with KiwiBuild,” he says. Twyford says that the government needed to feel sure buyers could service their mortgage. “I know people were genuinely shocked that the income cap was set so high, but that’s a sign of how out of whack the housing market has got.”

‘ No one can kick me out of here’

Twyford examined financial assistance programmes for housing, like those in the US. But one of the primary inspirations for KiwiBuild was the Million Programme, a Swedish initiative in the 1960s and 70s that enabled the government to turn a housing shortage into a surplus by simply building more dwellings (though presently, Sweden faces a housing shortage again). Any successful programme, he said, would need to stimulate construction and incentivise scale – otherwise there wouldn’t be enough properties to help young buyers into.

Some, however, say they would prefer financial help. Daniel Robson, an office worker in Wellington, says he was eager to buy his own place, but after 20 years of working, he was still priced out of the market. Even a KiwiBuild home would be too expensive.

“Building more houses is good, but it doesn’t help me get into a house when it costs the same as other properties in the area,” he says. Worried about supporting himself in his retirement if he did not own property, Robson says he is also tired of renting. “I live with three other people and I’m 38. At this age, I shouldn’t be living in a shared flatting situation.”

No promised assistance is on the way, though New Zealand’s government has also promised to strengthen rights for tenants. Unlike in some European countries, many renters cannot so much as hang picture hooks in their homes, and can be subject to annual rent increases.

Cooper, the KiwiBuild hopeful, agreed that the risk of renting played a large part in his desire for his own home.

“No one can kick me out of here – I can paint the walls whatever colour I want, I can make it feng shui, I can raise my children and they can crayon the walls, and it doesn’t matter,” he says. “It’s not actually about having an asset. It’s about knowing you have a space and somewhere to belong.”

Source: Charlotte Graham-McLay

Housing: Long-term affordability needed

Council Chair Mel Rapozo and I have co-introduced ​Bill 2725​ that would establish a policy of long-term affordability for housing that is provided with taxpayer monies and/or required as a condition of zoning. Bill 2725 would prevent such housing from being sold into the market after a number of years.

Instead, if a qualified family chooses to leave the affordable housing unit, that unit will be available to another qualified family. Buyers of for-sale or leasehold units would be able to recoup their equity but would not be entitled to speculative gains.

Here’s some background on the bill:

The 2,700 affordable homes that the county has developed or required as a condition of zoning over the last 40 years have blessed the families living in these homes and the community as a whole. We all benefit when our families are well housed.

Having built 2,700 units over 40 years, we now have to produce 7,200 homes in 20 years — a herculean task! The recently updated General Plan projects a need for 9,000 housing units over the next 20 years. Based on a recent County Housing Needs Study, 80 percent of those 9,000 units — 7,200 units — need to be affordable for qualified families.

Whenever any affordable unit is re-sold into the market, our efforts to achieve an expanding inventory of affordable housing units are set back because a qualified family is no longer able to afford that home. ​Returning units to the public trust makes it possible to keep the homes affordable.

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Up to now, county policy has allowed affordable housing units, on an ad hoc basis, to be sold into the market. This means that taxpayer monies used to build an affordable house (average cost of $450,000) provides only one generation of affordable housing. The county, then, is always playing “catch up.”

Examples include Kilauea Estates which was built as a result of a zoning condition and with federal post-Iniki monies. The homes went to exactly the people we wanted to help: Kilauea residents born and raised on Kauai, single moms with kids, mechanics, teachers, administrative assistants and others.

These families bought their homes for $159,000 to $180,000 in 1998-99. A 10-year buyback clause required them to sell the units back to the county if they resold the units within 10 years, but after that, the units could be sold at market prices. The homes are now selling for around $600,000.

The unworkability of existing policy is most apparent with the example of Courtyard at Waipouli.

The 82-unit affordable housing rental project across from Kintaro Restaurant was required as a condition of zoning for the Kauai Lagoons resort development (750 luxury oceanfront condos above the Kauai Marriott), but it had only a 10-year buy-back clause.

In 2009, in an act of short-sightedness, the County Council and mayor permanently waived the affordability requirement for 41 of the 82 units. Next year, on Aug. 19, 2019, the buy-back clause expires and with it the affordability of the remaining affordable units.

Forty-one qualified families renting there will have to move. So will the other 41 who are renting at market rates if the units are converted to vacation rentals. In this current housing market, where will all these families go? Instead of expanding, Kauai’s affordable housing inventory will be shrinking.

By requiring that all future affordable housing provided as a condition of zoning and/or using federal, state or county monies be affordable for the longest period allowed under the law, Bill 2725 will prevent 10-, 20-, 30-year buybacks.

Instead, it will encourage existing forms of affordable housing such as multi-family rentals on county-owned land and 99-year leaseholds of single-family homes.

It will also encourage new forms of affordable housing, such as limited equity cooperative housing and community land trusts. In all of the above forms, except for multifamily rentals, the original owner will be able to get back his/her equity if the owner chooses to move.

In conclusion, Bill 2725 establishes a policy that will prevent backsliding and will instead enable the county to create an ever-expanding inventory of affordable housing.

Only then will we begin to address the crisis that is causing both short-term and long-term suffering of local families and a diminished quality of life on Kauai for all.

A public hearing on the bill will be held Wednesday at 1:30 p.m. in the Council Chambers at the Historic County Building.

Source: Joann Yukimura

A 25-year wait for housing: ‘Will we die living in these shacks on the mountain slopes?’

“When Mandela was released from prison in 1994 I was staying in this place and had been here for years.” Sixty-six-year-old shack dweller Nowethu Ngxangana is one of hundreds hoping for a house in the new Dido Valley housing project, GroundUpreported.

The small community of Redhill, on the mountain slopes overlooking Simon’s Town, is home to 652 households, according to the City of Cape Town, including 182 families who rent from other families.

Ngxangana lives in a four-room shack with her 11-year-old granddaughter in Redhill. She does not remember exactly which year she moved here, but she has been here for many decades.

The housing project in Dido Valley will contain 600 units, of which, according to City of Cape Town Media Manager Luthando Tyhalibongo, 100 will be set aside for families who who were forcefully removed from Luyolo in Simon’s Town in 1968. A limited number of units will also be made available to applicants from all over the city who have been on the housing waiting list the longest.

“Everyone who comes here promises housing”

“Everyone who comes here promises housing like it will happen in the next year, and we have been waiting patiently for many years,” says Ngxangana. She says many people who moved to Redhill when she did have given up waiting and have left. Some have moved to Masiphumelele, 16km away.

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“Those who got tired and moved to Masiphumelele many years ago have houses now and we are still staying in shacks with no indication when we will be in our houses,” said Ngxangama.

Her neighbour, 68-year-old Elizabeth Fete, was a domestic worker in the area for more than 20 years. She lives with her five grandchildren. Fete recalls a protest held by the community in 1996.

“That was the first time that the people of this place stood up and protested and demanded services. After that we got electricity, and promise after promise came on when we would get houses. Each time it’s a different promise.

“When we moved here, the Masiphumelele community didn’t exist but now almost everyone there has a house and we are still waiting.

“We want to move, for a better life”

“Here if you do not catch a taxi in the morning you have to hitch-hike. On the land where the new houses will be, the mall is closer, and the taxis are there. We want to move, for a better life where we have toilets inside and can get to clinics and hospitals easily,” said Fete.

She says last year Redhill residents were told they would be in their houses by June 2017 then the date was moved to November 2018.

“All we are seeing now is trees growing back on that land with no houses. We are left to wonder when the next promise will be made and whether we will ever get those houses or die living in these shacks,” says Fete.

Asked why the construction of houses had not yet started, Tyhalibongo said the budget was moved to the 2019/20 financial year and that not enough housing beneficiaries had been identified.

He said it was not yet clear how many people would qualify for a housing subsidy. “However, it is the intention of the project to accommodate the entire population of Redhill.”

Tyhalibongo said tenants would generally have to move with their landlords. If there were extra units available after all owners had been accommodated, tenants would be considered for housing.

He said engineering work had been completed in January 2018 and construction of houses was due to start in July 2019.

Source: Thembela Ntongana

Sales, prices and rents fall in Abu Dhabi in third quarter of 2018, latest data shows

Property sales in Abu Dhabi fell in the third quarter of 2018 as demand fell while residential prices and rents also declined, according to the latest index report.

The data from the Asteco market review also shows that prices have now fallen by 1% quarter on quarter and 8% on an annual basis but there are variations depending on location while off-plan and new properties are more on demand than existing homes.

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Prices in Al Reem Island and Al Reef Downtown areas, for example, decreased by 11% year on year while Al Reef Villas and Al Raha Gardens recorded average annual declines of 6% in the third quarter.

Asteco recorded the delivery of around 2,150 residential units in the quarter with 60% located within the Abu Dhabi Investment Zones, including but not limited to Al Reem Island, Al Raha Beach and Yas Island.

Lamar, situated on Al Raha Beach, comprising 430 units, represented the single largest project handed over and in addition, several buildings within the Rawdhat district were also completed, with further inventory expected for delivery over the next six to 12 months.

Although more delays are likely, Asteco projects another 3,100 apartments and villas will be handed over prior to the end of 2018 within the Al Reem Island seeing around 1,000 units, Yas Island and Saadiyat Island 900 units, Abu Dhabi Island 470 units and the rest in Abu Dhabi mainland, including 580 villas.

The report shows that rents continued to fall, with apartment rents down by 3% on average quarter on quarter and by 11% year on year, with the highest declines in middle and lower end properties.

Villa rental rates followed a similar trend, down 1% quarter on quarter and down by 8% year on year. Al Reef Village and Hydra Village registered a more pronounced quarterly drop of 4%.

The falls are the result of new supply and subdued levels of demand, largely attributed to a bearish economic/business outlook. ‘These conditions contributed to an increase in vacancy rates, particularly in buildings with lower quality specifications,’ the report says.

Source: PropertyWire

Reducing housing deficit is FG’s priority -Minister

Malam Suleiman Zarma, the Minister of State II for Power, Works and Housing, says the Federal Government is committed to the reduction of  the nation’s housing deficit, put at over 17 million, through its National Housing Programme (NHP).

Zarma spoke on Thursday in Abuja at the inauguration of a three-block of 12 units of two bedroom flats in Lugbe, Abuja.

The structure was built by the Staff Multi-Purpose Cooperative Society (SMCS) of the Housing Sector, Federal Ministry of Power, Works and Housing.

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The minister commended the foresight, innovative ideas and the efforts of SMCS officials for taking a giant step to address the housing needs of its members.

He said the project was in line with the core mandate of the ministry to ensure adequate, affordable and sustainable housing delivery in the country.

“The ministry’s present leadership is committed to advancing the cause of the welfare of staff.

“Talking about support, I mean providing you with some technical and logistic assistance to realise your objectives,” he said.

He urged the leadership of the society to ensure that their structures were built on lands that were properly acquired in line with laid down rules.

In his remarks, Mr Frank Ijiofor, the Chairman of SMCS said the project was executed at the cost of N86.5 million through direct labour.

He solicited Federal Government’s assistance  in the construction of roads leading to the society’s housing projects spread across FCT.

Source: NAN

Challenges Of Affordable Housing And The Way Forward

Housing has a central importance to quality of life with considerable economic, social, cultural and personal significance. Though a country’s national prosperity is usually measured in economic terms, increasing wealth is of diminished value unless all can share its benefits and if the growing wealth is not used to redress growing social deficiencies, one of which is housing. Housing plays a huge role in revitalizing economic growth in any country, with shelter being among key indicators of development.

The universal declaration of human rights gives one of the basic human rights as the right to a decent standard of living, central to which is the access to adequate housing (United Nations, The Human Rights – article 25, 1948). Housing as a basic human right demands that urban dwellers should have access to decent housing, defined as one that provides a foundation for, rather than being a barrier to, good physical and mental health, personal development and the fulfillment of life objectives

Affordable housing is a term used to describe dwelling units whose total housing costs are deemed “affordable” to those that have a median income. A median income refers to the average pay scale level of the majority people in a population which is often low. Although the term “affordable housing” is often applied to rental housing that is within the financial means of those in the lower income ranges of a geographical area, the concept is applicable to both renters and purchasers in all income ranges.

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Low-income housing is aimed at individuals without enough income to provide adequate housing for themselves and/or their families. These families are usually unable to purchase a home because they fail to qualify for a mortgage. Most families choose to rent based on their income and family situation; unfortunately, there may not be enough rental housing or enough good-quality rental housing for low-income families

Provision of adequate, affordable and decent housing for low income households is clearly in short supply. The players in this industry are too few and there seems to be a minimal interest of other private sector housing developers to provide low income housing units. These private sector developers as by their success in the middle and high income housing markets, implies that they may have the capacity and skill set to supply the low-income housing required to alleviate.

There are also many other factors affecting the supply of housing from private sector housing developers prominent of which is the cost of production and the opportunity cost to the developer’s finite funds in either providing middle income housing or high income segment housing or low income housing. The developers have to consider the rate of return to their investment and how fast they’ll realize this. But these are not the only factors affecting the supply of low income housing and the other factors should also be put into consideration. Provision of low cost housing to the increasing number of lower and middle income classes in the country has also been hugely affected by the cost of land and inadequate infrastructure.

All governments in Nigeria since independence have highlighted housing as a major priority.Unfortunately, for 50 years of its independence, Nigeria is yet to develop a vibrant mortgage market and houses continue to be provided through the tortuous traditional method of buying land and building over some years, which could be an individual’s entire life time. In many cases such buildings are left uncompleted or individuals have to deplete their entire life savings in order to build a home.

Ministry of (Power, Works and Housing) is tasked  with the provision of housing  across the country, since  inception, it  has been putting up efforts to see that housing, especially  affordable ones are provided for the teeming Nigerian population.However, in spite of the laudable strides of the Ministry in seeing to the reduction of wide housing gaps among the citizens of Nigeria, especially among the middle and low class, the gap still yawns wider.


Registering property constitutes one of the challenges facing the housing sector in the country. According to the World Bank report, “Doing Business in 2007 – How to Reform”, Nigeria’s reforms have led to a reduction in the time required to complete the process of property registration from 274 to 80 days, but a lot still needs to be done because it takes only 1 day in some other countries such as Norway and Singapore. We should however note that part of the reduction in time is likely a result of improvements in property registration which has been implemented in Abuja and Lagos.  It is pertinent for other state governments to replicate the improvements achieved in the Abuja Geographic Information System (AGIS) and Lagos State, in their various states as investors are comfortable in environments where registration is automated and procedures are minimal, and will be glad to invest in such places.

In the aspect of risk sharing, unfortunately there is no mechanism for risk sharing that will encourage banks and other financial institutions to extend mortgage loans to people at the lower income level.High cost of building materials is also a key factor that has led to the high construction cost in Nigeria.

Similarly, lack of basic infrastructure like roads, water and electricity is a major challenge to providing affordable housing, which accounts for about 30 percent of housing costs. In most cases developers have to provide the infrastructure which invariably increases the cost of the houses they produce thus making such houses unaffordable.

The Way Forward

In order to bring down materials costs and stimulate construction, as well as make housing more affordable to the Nigerian population, government should continue its reconsideration of restrictions on the importation of cement and other building materials. Another alternative is  to  explore more on how we can use local materials such as clay and other local building materials.

Government can provide guarantees in the form of mortgage insurance to lenders for loans granted to first time buyers with no credit history and low to middle income families once such mortgage loans meet prescribed underwriting standards. In the event of default, the government indemnifies the lenders to a prescribed level.The three tiers of government should not shy away from their responsibility of providing primary infrastructure if we must achieve our goal of providing affordable housing.

The goal of providing affordable housing can be achieved, but the necessary ingredients have to be put in place. Investors can work in difficult environments in the short-term if there is convincing evidence that reforms that will improve the investment climate will be implemented as quickly as possible.

We must keep working at improving the investment climate, and this can be achieved by just studying what other countries have done and implementing international best practices. In doing this we must not miss the goal of ensuring macroeconomic stability, such as keeping inflation and interest rates down.

SOURCE: Affa Dickson Acho.


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