States’ economies sees improvement as Fund’s intervention targets 500,000 home and 1.5m jobs

The intervention by the Family Home Fund (FHF) in the Nigerian housing sector to deliver affordable housing to low-income earners in the country will significantly improve the GDP and economy of the states where the intervention is already yielding fruits, people familiar with the Fund have said.

EchoStone is a property development firm that deploys an innovative technology which allows rapid and scalable construction of houses. It is currently building 2,000 housing units beginning with 250 units of two-bedroom detached bungalows in Idale Badagry, Lagos. FHF is to build 20,000 housing units in Lagos.

So far, about six state governments including the FCT have donated land for the development of various numbers of housing units, including Ebonyi State which has donated land for developing 1,200 homes.

Kaduna State has also donated land for its millennium city which promises about 650 homes; the ancient city of Kano has 757 homes; Asaba, Delta State, about 620 homes; Ogun State, about 1, 074 homes; FCT, about 580 homes, while Akwa Ibom has donated land and signed MoU with the fund for the construction of 5,000 low-income houses.

There is an expectation that through a combination of these housing development activities, 1.5 million jobs will be created for both skilled and unskilled labour that will be working at the construction sites.

Analysts say the creation of 1.5 million jobs will have significant impact on the economies of the states, more so with the multiplier effect of job creation.

“When you give job to one person, you shall have impacted the lives of about four or five more persons,” noted Johnson Chukwuma, a civil engineer.

He explained that, one way or another, part of the income earned by these workers goes to the state government by way of paying taxes or other levies, stressing that a state with healthy citizens is, by implication, a wealthy state.

FHF, which is arguably the largest affordable housing-focused fund in sub-Saharan Africa, was in Lagos recently and, according to Femi Adewole, its managing director, its mission to Lagos was to explore a potential partnership for a large-scale affordable housing scheme with a specific focus on Lagosians on low income.

“Alongside good quality homes, the programme will be looking to create jobs for Lagosians. Other aspects of the scheme include a commitment that we are not just to build housing units; we also need to look into the environment and climate change issues which now stare us in the face,” Adewole said.

He assured of the fund’s commitment to the provision of affordable housing, disclosing that they had invested over N20 billion in housing projects to support Nigerians who are earning below N100,000.

“We are also providing financing for developers who will build homes ranging between N2.5 million to N5 million,” he said.

Besides providing funding for the product suppliers, the Fund also aids the demand side by assisting house buyers, giving them a deferred loan for up to 40 percent cost of the houses.
The Fund supports local content in the house-building process and Adewole disclosed that their long-term objective was to ensure that up to 80 percent of manufactured inputs were locally produced.

 

Source: Chuka Uroko

family

Seven ways to get your child a first home

It has never been harder to get a foot on the housing ladder. House prices are now nearly eight times the average wage, and they have been rising faster than most can save.

Almost one in four first-time buyers are now turning to the ‘Bank of Mum and Dad’, figures from insurer Aldermore Bank show.

And 30-year-olds whose parents have no property wealth are 60 percent less likely to be homeowners, according to the Resolution Foundation.

But if you can’t hand over a hefty deposit to your loved ones, you could still lend a hand.

Last week we explained how you can aid them in preparing their finances to get mortgage-fit in two years. Here, we explore other ways to help them get the keys to their first home…

GIVE IT ALL AWAY

Family or friends can give all — or a chunk — of a deposit to the buyer as a simple, tax-free, non-returnable gift.

Simply handing over a deposit is the most common way parents help their children onto the ladder, and this is where the term ‘Bank of Mum and Dad’ originates.

Legal & General figures show the Bank of Mum and Dad gave close to £5.7 billion in 2018.

Alongside savings accounts for first-time buyers such as Help to Buy and Lifetime Isas, a gifted deposit can top up any shortfall.

But this may be an option only for wealthy parents who have money they won’t need in retirement if they intend to give all their loved ones an equal deposit.

Vicky Bradley, a product manager at Skipton Building Society, had saved £9,000 for a deposit when she fell in love with a £125,000 two-bed terraced house in Keighley, West Yorkshire.

Her parents, Bob and Linda Bradley, offered to help cover the 10 percent deposit and fees.

‘They agreed to an informal loan of £3,000, but then told me it was really a gift,’ says Vicky. ‘It was such a lovely surprise and allowed me to arrange a mortgage straight away.’

Gifted money could be subject to inheritance tax. For gifts above your annual allowance of £3,000, you must live longer than seven years from the date you gave the money away to avoid the risk of an inheritance tax liability on your donation.

A gifted deposit can also prompt questions over who gets the money back if a couple of splits and their house is sold.

A solicitor can draw up a legal document such as a Declaration of Trust to note which buyer the gift was given , and the share of the property to which they are entitled.

…OR GET IT BACK

If you cannot afford to give a deposit away, then you can lend it — on your own terms.

A loan lets you keep some control by specifying when you need the cash back. It may be exempt from inheritance tax but the rules are complex, so check with a tax expert first.

A solicitor is needed to draw up the terms and, just like with a mortgage, the parents would register a charge on the property deeds to ensure the loan is paid back.

The charge on the deeds would specify that on the sale of the property, or when it is remortgaged, the money lent is repaid.

A drawback for the parents, however, is that they are also required to stick to the terms and cannot readily access their cash.

Only a handful of lenders accept a parental loan as a deposit, and those that do take monthly repayments into account — which could restrict the amount your child can borrow.

LOAN YOUR NAME 

First-time buyers can now add their parents to the mortgage application while keeping Mum and Dad’s names off the deeds.

A ‘joint borrower, sole proprietor’ deal allows the buyer to apply for a home loan using their parents’ income. Adding family members to the mortgage, but not the property, has grown in popularity.

Lenders prefer this over a traditional guarantor deal, where parents are vetted separately to make sure they can make payments in case the children default on the loan.

After Virgin Money withdrew its guarantor mortgage last year due to a lack of demand, only a handful of lenders, including Hinckley & Rugby, Cambridge and Market Harborough building societies, will still consider this type of deal.

Instead, around 20 lenders offer the new joint borrower arrangement — double that available ten years ago.

High Street banks such as Barclays, Metro, and Clydesdale offer a mortgage on these terms, along with building societies such as Newcastle, Hinckley & Rugby and Buckinghamshire. Interest rates are typically the same as with a regular mortgage.

The cheapest five-year fix available is 2.34 percent with Barclays for borrowers with a 10 percent deposit. On a mortgage of £150,000, the monthly repayments would be £661. Over five years, the total cost of the mortgage, including a £999 fee, would be £40,659.

The length of the mortgage offered will depend on the age of the oldest borrower.

Mark Harris, chief executive of mortgage broker SPF Private Clients, says: ‘This type of deal helps with the affordability of the mortgage but not the deposit.

It also ensures the child qualifies for first-time buyer stamp duty exemptions, while the parents sidestep the additional 3 percent stamp duty surcharge for purchasing a second home.’

And by not owning a share of the first-time buyer’s home, parents can also avoid paying capital gains tax on any increase in the value of the house when it is sold.

But Mr Harris warns: ‘Anyone named on the mortgage is jointly responsible for making payments. It could also damage their credit rating if repayments are not maintained, and affect the parents’ ability to take out further debt in the future.’

 

SAVINGS SWAP

Among specialist offers aimed at families is a 100 percent mortgage tied to a savings account.

This allows first-time buyers to buy a house without a deposit on the condition that a family member deposits money in attached savings account for a fixed period.

The Barclays Family Springboard and Lloyds Lend A Hand mortgages require 10 percent of the value of the house to be locked away in a fixed-interest savings account for three years.

Although your money is tucked away and you cannot access it in an emergency, you will get it back, along with interest, when the term ends.

Lloyds pays 2.5 percent on savings, and Barclays currently pays 2.25 percent — its rate is set 1.5 percent above the Bank of England base rate.

David Hollingworth, of mortgage broker L&C, says: ‘This could help parents or grandparents who are not in a position to give money away, or have a large family and need to share their wealth around.’

But for the first-time buyer, it may mean they have to stay in the property until its value increases enough to give them a substantial deposit in order to take the next step on the housing ladder.

If the house price falls, they could find themselves in negative equity. If mortgage payments are missed, banks may hold on to the money for longer until they are cleared or, depending on the lender, use some of the money to clear any debts.

Former garage owner Carl Bojen, 65, used the Family Springboard mortgage to help his granddaughter Toni Thornton, 28, buy her first home nearby in Grimsby, Lincolnshire, with partner Kane Ramsey and their son Ronny, three.

‘I want to help all my grandchildren buy their own homes, but it would break me to give all six of them a deposit,’ Carl says.

Carl and his wife Linda, 65, put £13,200 of their savings — 10 percent of the £132,000 purchase price — into a Barclays savings account attached to the mortgage. After three years Carl and Linda will get their money back with interest, ready to help their next grandchild.

Without help, Toni, who works in telephone sales, and electrician Kane would have had to save for another three years.

HOME BETTING

Another option for families is, instead of offering cash as a deposit, parents can allow the bank to put a charge — like a mortgage — on their home for the equivalent amount.

The value of that charge could be, for example, 20 to 25 percent of the value of the first-time buyer’s house. It remains on the property for around 10 years.

It can be reviewed before then, and if there is enough equity built up in the home, it can be removed early.

Aldermore Bank and Family Building Society are two lenders that offer these types of mortgages. Family BS requires the first-time buyer to contribute 5 percent of the deposit.

It could suit parents who have lots of property wealth and do not plan to move house.

If parents want to move, particularly in the short term, there must be enough equity in their new home to still provide the same guarantee.

There is also the risk that they could lose their home if their child or grandchild’s house is repossessed and there is not enough money to repay the loan.

SLASH INTEREST

Families can also use a savings account to slash the interest a first-time buyer pays on their mortgage.

A family offset mortgage is similar to the savings and mortgage account option, but instead of getting interested on the money in the account, it is used to reduce the mortgage cost.

When the mortgage lender checks whether the first-time buyer can afford the mortgage, they will base the assessment on the lower monthly payments, after the parents’ savings have been taken into account.

For example, if a mortgage of £150,000 was taken out, and £50,000 savings were deposited in the account, the borrower would only pay interest on £100,000 of the mortgage.

Family Building Society and Yorkshire Building Society are among those which offer the deal.

Parents will get their money back after a fixed period. This is usually ten years, but it can be reviewed earlier — for example, when the borrower’s fixed rate comes to an end.

The drawback is that the money is locked away for a period and will not earn interest for the parents. It could also be eroded by inflation.

If the house is repossessed or sold for less than the loan amount due, savings in the offset account can also be used to foot the shortfall.

But in a low-interest rate environment, savers may prefer to forego earning a small amount of interest in favor of helping their children pay less towards their monthly mortgage payments.

Kim and Alison Wilkinson, both 60, from Surrey, used a Family Building Society offset mortgage to help their daughter Sarah, 26, buy a £260,000 three-bedroom terraced home in Portsmouth, Hampshire.

The couple had built up savings but did not need to use them in the short term. Earning next to no interest in a savings account, they decided to put the money to better use.

Secondary school teacher Sarah’s mortgage with Family BS was fixed for five years at 2.89 percent.

‘Mum and Dad wanted their money to work as hard as possible,’ says Sarah. ‘By putting it in the offset account, it effectively earned 2.89 percent.’

While she could afford the monthly repayments without her parents’ help, she says: ‘This reduced my mortgage payment from around £750 to £550, which gave me the more disposable income to furnish the house and enjoy treats such as holidays, which I may not have been able to do as a first-time buyer.’

CASH IN PROPERTY

Income-poor older homeowners with plenty of property wealth could unlock their home’s equity to help.

Equity release is available to borrowers aged 55 or over. It allows homeowners to gift their property wealth now, instead of waiting until they die and their house is sold.

In the first half of 2018, close to 20 percent of borrowers taking out equity release used the money to help the family, according to Canada Life.4

The only has to be repaid only when the homeowner dies or moves into long-term care. There are also options that allow borrowers to pay the monthly interest if they want to reduce the cost of the overall loan.

This can also reduce your inheritance tax liability, as the value of the equity release loan will be deducted from the overall estate when the inheritance tax bill is calculated.

Rates on equity release mortgages are higher than traditional mortgages. The average interest rate is 5.24 percent, compared to the average two-year fixed rate of 2.49 percent on a traditional mortgage.

Interest is also rolled up and added to the loan monthly, which can double the debt every 14 years.

Parents or grandparents should seek legal advice before entering into a family mortgage arrangement.

Source: DailyMail

Dangote Re-affirms Commitment to Nigeria’s Economic Potential

Alhaji Aliko Dangote, President, Dangote Industries, says his continuous efforts to innovate, create value and invest in Nigeria’s economy is borne out of his firm belief in its vast economic potential.

Dangote said this during Dangote Cement Distributor’s Award Night on Monday in Lagos.

He said his target was to ensure that Nigeria becomes self-sufficient in all the sectors where Dangote Industries have its footprint — cement, agriculture, mining and petroleum.

The industrialist noted that the company was at the forefront in exploring opportunities targeted at the diversification of the economy and had continued to roll out massive agricultural projects across the country.

“We have started in rice, while plans are underway for dairy farming. Our push for backward integration in providing our own raw materials on a massive scale has led to the planned investment of 4.6 billion dollars over the next three years in sugar, rice and dairy production alone.

“That will eliminate the country’s reliance on imported food and the foreign exchange outflow that comes with it,” he said.

The industrialist noted that the award was to celebrate its valued customers and distributors for their unflinching partnership in ensuring that Dangote cement products remained the first choice for construction purposes across the country.

“You have made Dangote Cement become a household name and the product of choice among cement users in Nigeria.

“We are leaders in all the sectors where we play, and this demands continuous improvement and partnership with you, our customers.

“Our cement plant in Obajana, Kogi State, is already the biggest in Africa. We are building the fifth line, and hopefully it will come on stream early next year and will make its production 16.25 million tonnes.

“The cement plant and its sisters in Ibeshe, Ogun and Gboko, Benue have long been the bedrock of our leading role in the cement sector.

“Therefore, we are rewarding customers for growth. If they grow, we grow. We grow together,” he said.

Dangote pledged his commitment to the continued innovation toward creating more value for customers as well as stakeholders.

The overall National Best Growth customers rewarded were D.C. Okika Ltd, Lafenax Ltd., Gilbert Igweka Global Concept, Chinedu & Sons Ltd, and Kazab Heritage Ltd.

Also, some of the best Corporate Customers were CCECC Nig. Ltd, ITB Concrete, Julius Berger Nig. Ltd, Dantata & Sawoe Construction Company, EXTEX Group and Setraco Nigeria Ltd.

Dangote Cement posted a Profit After Tax (PAT) of N390.32 billion in its 2018 operations, as against N204.25 billion achieved in 2017.

Besides, the company has maintained its dominance of the Nigerian market, accounting for 65 per cent of the total volume sold in the domestic cement sector in 2018.

Cement revenue from its Nigerian operations increased by 11.9 per cent to N618.3 billion from N552.4 billion.

Source: Vanguard

Real Estate – Sector’s Growth Yet to Recover from Recession

A breakdown of the recently released GDP report by the National Bureau of Statistics showed a further contraction in the real estate sector. The sector’s real growth stood at -3.85% from -2.68% recorded in the preceding quarter.

The sector has now been in the negative territory for at least 12 consecutive quarters. However, the sector’s contribution increased from 6.5% in Q3’18 to 6.6% in Q4’18.

The global real estate agency, Knight Frank, recently released its ‘The London Report 2019’. In this report, the agency observed:

1. Commercial offices in central London attracted a total of £16.2 billion of global capital ahead of other cities like Paris, Manhattan and Hong Kong. China was the largest investor in the city.

2. London’s real estate market remains the most liquid and transparent in the global market. This will remain an attractive feature for global and domestic investors.

What does this mean for developing countries like Nigeria?

Renewed hope in London’s real estate market coupled with the negative growth recorded in Nigeria’s real estate market reduces the possibility of increased investment in the domestic real estate sector.

Performance of real estate companies in Nigeria

Currently, four companies – UPDC, UAC Property, Union Homes and Skye Shelter Fund – are listed on the Nigerian Stock Exchange.

In the period between December 31, 2018 and January 31, 2019 there was mixed movement in share prices across the board. UPDC and UAC shares declined by 9.9% and 9.95% respectively to N5.95 and N1.72. Union Homes and Skye Shelter Fund’s share prices remained flat at N45.20 and N95.00 respectively.

Proshare Nigeria Pvt. Ltd.

Outlook for real estate in February

Minimal activities are expected within the real estate sector in February. The election season will slow down activities across various sectors including real estate. However, we expect activities within the sector to improve by H2’19, driven by increased government spending.

Source: Proshareng

Singapore to pay bonus to all citizens after surplus budget

All Singapore citizens aged 21 and above will get a one-off “SG Bonus” of up to S$300 each as the 2017 budget came in with a surplus of almost S$10 billion (US $7.6 billion), the city-state’s finance minister announced on Monday.

Finance minister Heng Swee Keat made the announcement during his budget speech in Parliament, describing the bonus as a “hongbao”, the Mandarin word for a monetary gift given on special occasions.

He said this “reflects the government’s long-standing commitment to share of the fruits of Singapore’s development with Singaporeans”, according to Channel News Asia.

The “SG Bonus” will cost the government S$700 million (US $533 million).

The bonus will be paid according to people’s assessable income. About 2.7 million people will get the payouts, which are due by the end of 2018.

Those with an income of S$28,000 or below will be eligible to receive S$300, those whose incomes ranging from S$28,001 to S$100,000 will receive S$200, and those with incomes in excess of S$100,000 will receive S$100.

Singapore’s revised budget for fiscal 2017 showed a surplus of S$9.61 billion, thanks to contributions from statutory boards and higher-than-expected stamp duty.

African cities become the new home to over 40,000 people every day, many of whom find themselves without a roof over their heads. With that in mind, IFC has committed to do more to develop the property sector, both to provide new and affordable housing and to encourage an industry that requires significant building materials and has the potential to be a major employer. In May, IFC and Chinese multinational construction and engineering company, CITIC Construction launched a $300 million investment platform, CITICC (Africa) Holding Limited, to develop affordable housing in multiple African countries. The platform will partner with local housing developers and provide long-term capital to develop 30,000 homes over next five years. IFC estimates that each housing unit will create five full-time jobs – resulting in nearly 150,000 new jobs on the continent. Kenya and Nigeria are high on the priority list for the new effort. Kenya’s housing shortage is estimated at 2 million units, while Nigeria is in want of 17 million units. The soaring demand is being met by scant new supply. Africa’s housing market has few local developers with the technical and financial strength to construct large-scale projects. The IFC-CITIC Construction platform will work with local housing companies to develop affordable housing projects across Sub-Saharan Africa, each ranging in size from 2,000 to 8,000 units. CITIC Construction has a proven track record in constructing and delivering large scale housing projects. The platform will start by developing homes in Kenya, Rwanda and Nigeria, expanding to other countries as operations ramp up. “In Angola, through planning, financing, construction and post-construction operation, CITIC Construction has successfully completed the 200,000 units housing program, new city of Kilamba Kiaxi, with relative infrastructure and utilities in four years. CITIC Construction has also founded the CITIC BN Vocational School in Angola which helps youth acquire the skills they need to become professionals”, said Hong Bo, Assistant President of CITIC Group and Chairwoman of CITIC Construction, “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.” “As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing”, said Oumar Seydi, IFC Director for Eastern and Southern Africa. “The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers. IFC will work with financial institutions to support mortgages and housing finance that will allow people to purchase the units.” The new housing units will be constructed in accordance to IFC’s green building standards, delivering homes that are environmentally friendly and sustainable. The World Bank Group estimates that by 2030, three billion people, or 40 percent of the world’s population will need new housing units. To date, IFC has invested more than $3 billion in housing finance in over 46 countries world-wide. IFC focuses on regions where large portions of the population live in sub-standard housing and have limited access to credit to build, expand, or renovate their homes.

The surplus will also be used in other ways. Heng said S$5 billion will be set aside for the Rail Infrastructure Fund to save up for new railway lines that Singapore is building.

Another S$2 billion will be set aside for premium subsidies and other forms of support for Eldershield, an insurance scheme that helps senior citizens with severe disabilities to cope with the financial demands of their daily care.

Source: hindustantimes

 

How non-implementation of local building materials’ policy is worsening housing delivery

A major paradigm shift in the use of indigenous building materials for housing design and construction may take long to come, following the inability of the Federal Government and its agencies to implement the new National Housing Policy.

Under the 2017 National Housing Policy, the government was urged to pursue vigorously the adoption of functional design standards that will facilitate cost reduction, affordability, acceptability and sustainability, which will respond to the cultural and regional peculiarities of potential users; expand and improve the manufacturing base for building materials production from all available local materials and evolve a more efficient distribution system.

According to the policy, the development of appropriate capacities to achieve sufficiency in the production of basic building materials and components of acceptable quality from local resources will stimulate effective economic growth and development; and structured manpower development programme for domestic requirement and international engagement.

The document further called on the authorities to encourage the expansion of existing industries producing building materials from local sources such as clay, bricks, concrete products, timber, glass and tiles.

It wants collaboration with other developing countries in the development of technical know-how for building materials manufacture; and encouragement in regional spread of building materials industries to stabilize cost as well as widen distribution.

Notwithstanding the good intentions of the stakeholders to ensure a robust indigenous building materials market, the absence of effective indigenous technology for the production of building materials, new building materials factories due to high cost of finance; inadequate and inefficient Infrastructural facilities (roads and rail transportation, water, sanitation, and power supply have worsened the plights of manufacturers and investors.

Besides, the recommendations of the policy for government to encourage the production and use of locally manufactured building materials by: providing incentives to, and creating the enabling environment for the private sector in order to encourage rapid flow of funds into building materials manufacturing through tax relief, accelerated depreciation and generous capital allowances are not adhered to.

There is also minimal support in providing matching grants for investments into research in the use of local materials for building materials manufacturers; providing loans at reduced rate of interest to manufacturers who will in turn supply self-built housing cooperatives and developers of low-income housing with their products at reasonable prices; attracting foreign participation into the building materials industry; and using local building materials for public projects at all tiers of government.

The Building Materials Producers Association of Nigeria (BUMPAN) formed to promote and encourage the production of building materials has remained in comatose.

The association is supposed to lay a solid foundation for the development of robust, effective and economically viable small and medium scale industries for the production of building materials.

Other strategies that are enshrined in the document such as strengthening the administrative, regulatory and institutional framework to ensure certification, registration and control of professional practices; supporting an integrated action programme for the organization of the informal building materials marketing sector; restructuring and adequately fund the Nigerian Building and Road Research Institute (NBRRI); and encourage establishment of building materials testing laboratories by the private sector have not been supported by the government.

Experts say, the non-adherence to the content of the policy is impacting negatively in the housing delivery, which should reduce the housing gap.

According to them, since the aim of the housing policy is to solve housing problems, there is the necessity to enhance the workability of the policy in order to achieve the goal.

Consequently, they stressed the need for periodic review of the housing policy to make it functional and acceptable.

The immediate past president of Nigeria Institute of Architects, (NIA), Tonye Braide, said the policy is a mere paper work as there are many cheap materials coming from China, which are competing with the local materials.

According to him, government should come out with a better policy as the price of the local materials are still high, which is reducing the local component needed for housing delivery.

He lamented a situation where materials that come from outside the country is cheaper and of higher quality, which will not help in mass construction of housing and ultimately reduce the housing deficit.

He said: “ it is not right that some body will carry materials all the way from China and it will be cheaper than the one manufactured locally.

“Like the project, we are doing in Akwa ibom, there is no local content element in the project.

“In the presentation of proposal, you have to put it that construction will use local content and local labour but in practice that is not the case.

“I feel that there must be a conceited effort than the lip service we are seeing in the implementation of the policy”, he added.

For NIA second Vice President, Enyi Ben-Eboh, there is a noticeable difference to the extent that such materials like cement are locally available. “To a large extent, there are areas in basic housing that foreign components are utilised.

“ One of the few aspects is roofing aluminum sheets where we still depend on foreign materials imported.

He also said the foreign doors from China is becoming common. If you look at the cost in relation to a wooden door, which may not be as durable, people will still prefer Chinese metal doors.

“To that extent, the government may have to look into how some of these materials that are unfavourably competitive with local ones can be either made to pay higher tariff or allow incentives for local manufacturers to be able to compete to achieve mass housing and eventually reduce the housing deficit.

According to him, affordable housing thrives on mass production.

“Whatever is manufactured, if it is done over a large quantity ,the prices come down, so if most of these components are produced locally like cement, it can meet the housing demand in Nigeria.

“We will get to a time when local product outweighs demand, then competition will come and the price will begin to come down.

“Presently, if you assemble available materials for a two bedroom bungalow, the price will still not be affordable to those who wants it.

“You found out that those who can afford a two bedroom bungalow are senior civil servants who do not need that level of housing .

“For the people below level seven and downwards, they cannot afford the local materials based on their salaries”, he added.

Speaking also on the local content consideration of the policy, an official of the Nigerian Building and Road Research Institute (NBRRI), Razaq Babatunde Lawal said the institute has been able to develop building materials like Pozzolana, a cementious material, Mardotile roofing, and other varieties of machines but mass-producing it for the housing industry, has been a big challenge.

“Pozzolana is an ancient materials of construction that is coming back in view of its advantages and need to have an alternative cementitious material apart from over dependence on ordinary Portland cement hundred per cent.

The material like Pozzolana was developed and used in the past but it is now staging a come back become of its affordability and its usefulness as a building material.

Pozzolana materials include volcanic ash, power station fly ash, burnt clays ash from some burnt plant materials; siliceous earths. When mixed with cements, it activates the cementing properties to reduce cost of concretes made from composite materials often referred to as blended cement”.

According to him, the product reduces cost of efficiency of mortar and concretes, improves workability of mortar and concrete, reduces heat of hydration and reduction on effects of alkali aggregate reactivity.

He disclosed that the first pozzolana plant in Nigeria has been commissioned and ready for investors to show interest.

Lawal who works in the Engineering Materials Research Department (EMRD) said “NBRRI has developed interlocking block making machine in which the blocks made don’t necessarily need to use mortal while plastering yet you will have very aesthetic building.

We have developed fiber-reinforced material for roofing of buildings. We have also improved on it by increasing the size with about 5mm in thickness, longer and reduce the laying time. NBRRI has all the professionals in the building environment and has developed various machines for the built sector.

The institute, he said hasn’t been able to mass-produce the materials and equipment because its mandate is solely to carry out research.

He explained that while it carries out research, the institute expects the public, based on exhibitions attended that investors should reach out to it and develop the products to the next level in terms of commercialization and forming partnership through proposals.

He stated that the fund to mass-produce its products might not be available. However, he said with institutional, private and foreign supports, the commercialization of its materials could be possible.

African cities become the new home to over 40,000 people every day, many of whom find themselves without a roof over their heads. With that in mind, IFC has committed to do more to develop the property sector, both to provide new and affordable housing and to encourage an industry that requires significant building materials and has the potential to be a major employer. In May, IFC and Chinese multinational construction and engineering company, CITIC Construction launched a $300 million investment platform, CITICC (Africa) Holding Limited, to develop affordable housing in multiple African countries. The platform will partner with local housing developers and provide long-term capital to develop 30,000 homes over next five years. IFC estimates that each housing unit will create five full-time jobs – resulting in nearly 150,000 new jobs on the continent. Kenya and Nigeria are high on the priority list for the new effort. Kenya’s housing shortage is estimated at 2 million units, while Nigeria is in want of 17 million units. The soaring demand is being met by scant new supply. Africa’s housing market has few local developers with the technical and financial strength to construct large-scale projects. The IFC-CITIC Construction platform will work with local housing companies to develop affordable housing projects across Sub-Saharan Africa, each ranging in size from 2,000 to 8,000 units. CITIC Construction has a proven track record in constructing and delivering large scale housing projects. The platform will start by developing homes in Kenya, Rwanda and Nigeria, expanding to other countries as operations ramp up. “In Angola, through planning, financing, construction and post-construction operation, CITIC Construction has successfully completed the 200,000 units housing program, new city of Kilamba Kiaxi, with relative infrastructure and utilities in four years. CITIC Construction has also founded the CITIC BN Vocational School in Angola which helps youth acquire the skills they need to become professionals”, said Hong Bo, Assistant President of CITIC Group and Chairwoman of CITIC Construction, “CITIC Construction will take advantage of our engineering experience and delivery capability to develop more affordable houses for Africa through the platform with IFC.” “As Sub-Saharan Africa become more urbanized, the private sector can help governments meet the critical need for housing”, said Oumar Seydi, IFC Director for Eastern and Southern Africa. “The platform will help transform Africa’s housing markets by providing high quality, affordable homes, creating jobs, and demonstrating the viability of the sector to local developers. IFC will work with financial institutions to support mortgages and housing finance that will allow people to purchase the units.” The new housing units will be constructed in accordance to IFC’s green building standards, delivering homes that are environmentally friendly and sustainable. The World Bank Group estimates that by 2030, three billion people, or 40 percent of the world’s population will need new housing units. To date, IFC has invested more than $3 billion in housing finance in over 46 countries world-wide. IFC focuses on regions where large portions of the population live in sub-standard housing and have limited access to credit to build, expand, or renovate their homes.

“Government has tried by going into pilots of the inventions but as a research institute over the years, we just write papers and it remains on the shelf if the products of the efforts is not commercialized”. Now we are having pilot plans in some universities. Through research we can avoid emissions by stopping the use of cement and start using alternative material. Cement industry and construction firms can partner with us through programmes on affordable housing and when they are using their cement, they could think of Pozzolana”, he said.

He observed that for the past 11years, interventions from the institute were not been felt, however, the current crops of leadership are desirous to let Nigerians feel its activity through development of exceptional building materials for building construction in the country.

Managing Director of Bolyn construction Nigeria Limited, a brick manufacturing company, Elder Rufus Bamgbola Akinrolabu said government has shown lack of political will to implement housing policies.

He lamented that government’s direct involvement in the housing sector over the years has led to politicisation of policies and programmes including those relating to housing, to the detriment of Nigerians.

He blamed the situation on issue of corruption in system, which has made ‘nothing’ to be implemented in the previous years.

Akinrolabu, who is a manufacturer of low-cost housing equipment based in Lagos, explained that Nigeria’s housing problem could become a thing of the past if only the government and people will look inwards and use the local materials that God has blessed the nation with.

“Many of the policies require money to implement and with the fall in the global price of oil, where is the money? Nigerian government has no business in housing because everything has been politicised. if you politicize everything and you go to the national assembly, ask them to budget funds and the money is appropriated and at the end of the day, the money is shared. How can policies be implemented when the government has no money”, he said.

Source: Chinedum Uwaegbulam

 

Sovereign fund to boost power generation with N50 billion

A subsidiary of the Nigeria Sovereign Investment Authority (NSIA), InfraCredit, has opened a N50 billion 600MW Shiroro Hydro Electric Infrastructure Green Bond to boost the plant and power generation nationwide.

Launched in partnership with GuarantCo, KfW Development Bank and Africa Finance Corporation, the deal is covered by the North South Power Company Limited’s (NSP) N8.5 billion 15-year 15.60 per cent Series 1 Guaranteed Fixed Rate Senior Green Infrastructure Bonds Due 2034, operator of the 30-year concession programme.

In a statement, the Executive Vice Chairman/CEO, NSP, Dr. Olubunmi Peters, relished the milestone move.

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The Chief Executive Officer, InfraCredit, Chinua Azubuike, noted: “With the completion of the Series 1 Guaranteed Green Infrastructure Bond issuance, the company has established a long envisioned link with a more sustainable long-term, local currency financing required to implement its ambitious strategic power generation expansion plan through the capital markets.

“Infrastructure assets like Shiroro Hydroelectric Power Plant generate social, environmental and economic impact such as contributing to greenhouse gas emission reduction, revitalising disenfranchised areas, improving access to services and creating employment.

“Shiroro Hydro is an extremely essential and resilient asset with a 30-year consistent production history. North South Power, with the acquisition of a 30-year concession in 2013, has demonstrated the competence and ability to deliver on its business targets from restoring capacity target to 600MW and a 45 per cent increase in power generation.”

He added: “We believe that a sustainable and inclusive implementation of the eligible customer framework in a manner that generates economic benefits for all stakeholders will accelerate the industry’s strategic growth. With the success of this first-in-kind transaction, InfraCredit has further demonstrated its pioneering commitment to promoting financial inclusion.

Fund Manager, African Local Currency Bond Fund, James Doree remarked: “The first corporate green bond in Nigeria, issued by North South Power and supported by InfraCredit, sets a benchmark for the domestic and regional capital market.

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North South Power’s ongoing investments in the Shiroro power station since 2013 have restored nameplate capacity with minimal environmental impact and NSP is now able to generate more than 2,000 GWh on a yearly basis.”

Source: Mathia Okwe

godwin-emefiele-cbn

Emefiele Still CBN Governor

The Central Bank of Nigeria (CBN) has dismissed claims that the CBN governor, Godwin Emefiele has been sacked.

Responding to enquiries from The Nation on Monday, the Director Corporate Communications of the CBN Mr. Isaac Okorafor told The Nation that “the governor is in his office working. I don’t know what you’re talking about.”

Another official of the CBN also told The Nation Correspondent that “there is nothing like that, the governor is here, his tenure expires in June.

In fact he has functions to attend to tomorrow, one of which is to meet with stakeholders in the cotton value chain on Tuesday March 5, 2019.”

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An online medium had reported on Monday afternoon that the CBN governor has been sacked by the presidency and given two weeks to clear his table and “handover to an unnamed successor.“

Source: NationOnline

Odu’a signs N3.5bn housing deal with UK-based firm

Odu’a Investment Company Limited says it has signed a Memorandum of Understanding with United Kingdom-based Iconic City Limited for the development of a 3.8-hectare land in Alakia, Ibadan, the Oyo State capital, into a residential housing estate.

Odu’a said the agreement was in pursuit of its growth strategy predicated on unlocking value from its huge asset base for sustainable development.

Odu’a Investment Company Limited says it has signed a Memorandum of Understanding with United Kingdom-based Iconic City Limited for the development of a 3.8-hectare land in Alakia, Ibadan, the Oyo State capital, into a residential housing estate.

Odu’a said the agreement was in pursuit of its growth strategy predicated on unlocking value from its huge asset base for sustainable development.

According to the firm, the proposed residential housing estate which has been code-named ‘Westlink Iconic Estate’ is a medium density luxury estate consisting 124 households and will cost about N3.5bn.

“It comprises various housing types to allow for different market segmentation subscribers. The housing products are 60 units of three-bedroom apartments, 42 units of four-bedroom terrace houses, 14 units of five-bedroom semi-detached duplexes, eight units of six-bedroom fully detached duplexes and 36 commercial and business units,” the firm said.

It said the initiative was hinged on the Federal Government’s Economic Recovery and Growth Plan which had human capital development as one of its cardinal objectives with housing provision as key factor in achieving that goal.

The statement read in part, “The housing deficit in the country is over 22 million if not more, and investment in housing remains a worthwhile and profitable venture, especially when affordability is considered.

“Odu’a Investment Company Limited has identified partnership as a veritable strategy to add tremendous value to her existing property portfolio, earn remarkable return, strengthen her brand image and increase her socio-economic footprint for the benefit of its shareholders and stakeholders. The Estate which is scheduled for completion in 30 months will boast of state-of-the-art features.”

Raji was quoted to have said the N3.5bn joint venture investment with Iconic City was another landmark initiative to unlock value from the property portfolio of the Odu’a Group and bring on board a new dimension in structured and luxurious community living in Ibadan.

“This is in line with the vision of the board and management of the company to live the mandate of our shareholders to be the engine room of the economic development of the West,” he said.

Ogunmuyiwa was also quoted as saying the partnership would give his firm the opportunity to utilise its professional experience from training, working and living in the UK to build a world class mixed luxury residential estate in Ibadan.

“The designs and model types are exquisite and the finishing inviting and affordable,” he added.

Source: punchng

Help-to-buy scheme pushes housebuilder profits to £2.3bn

Britain’s biggest housebuilders paid out £2.3bn in dividends in their most recent financial year, as the help-to-buy subsidy pumped up their profits and house prices.

The nine biggest housebuilders listed on the London Stock Exchange declared the dividend payouts in their last full financial years, according to an analysis by AJ Bell, an investment platform.

Help to buy, introduced in 2013 and recently extended until 2023 for first-time buyers, was one of the flagship policies of the coalition government. Former Conservative chancellor George Osborne hoped to boost home ownership among young people, as house price growth far outpaced wage growth

However, many economists believe the scheme boosted house prices without making a significant impact on the supply of new houses, enabling a profits bonanza for Britain’s biggest house builders and their shareholders.


In 2012, the final full year before the help-to-buy scheme was introduced, the top nine firms – many of which had been battered by the financial crash – paid dividends of only £57.7m, according to AJ Bell. Dividends declared in the companies’ most recent financial year were about 39 times greater.

Since 2013 the nine house builders have paid out nearly £8bn in dividends, while City analysts forecast another £5.2bn in payouts in 2019 and 2020. Furthermore, shareholders have also enjoyed appreciation in housebuilders’ share prices, which have been sustained by the promise of further profits.

Persimmon, half of whose sales were part of help to buy, was responsible for 2018’s largest giveaway. Its shareholders collectively earned £732m in dividends in the year ending in December, after the company earned more than £1bn in profits.

Taylor Wimpey declared dividends of slightly less than £500m during the same period. Barratt Developments declared £435m in the year ending in June 2018. Bellway, Berkeley Group and Bovis all declared dividends of more than £120m in their last full financial year.

The large profits of housebuilders have attracted heavy criticism, amid a continued housing crisis and rising homelessness. Persimmon’s former chief executive, Jeff Fairburn, resigned in November following public fury over his £75m bonus, which had been scaled back from £110m after investor outrage.

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Greg Beales, the director of campaigns at the homelessness charity Shelter, said: “As all the big housebuilders announce soaring profits whilst the housing crisis worsens it couldn’t be clearer our housing market is broken. Whilst the big developers are doing better than ever, regular families are finding it harder and harder to afford somewhere to live.

“Disjointed schemes such as help to buy have only made things worse by inflating house prices and giving big developers a leg-up, while doing almost nothing to for those most in need of a genuinely affordable home.”

Under the help-to-buy equity loan, the government provides a low-interest loan worth up to 20% of the value of the property (or 40% in London) for prospective buyers of new-build homes, up to a maximum price of £600,000. The buyer needs to provide at least a 5% deposit and secure a mortgage for the rest.

A spokesman for the Home Builders Federation, an industry lobby group, said: “Home builders do not receive funding from help to buy but by supporting first-time buyers, the scheme has helped drive an unprecedented 80% increase in housing supply in five years, creating tens of thousands of jobs and boosting the UK economy to the tune of £38bn last year.”

However, the help-to-buy scheme has faced criticism across the political spectrum, from the Adam Smith Institute, a libertarian think tank, to the Labour party – although Labour is committed to keeping the scheme open until 2027 for first-time buyers below a certain income level.

Labour’s shadow housing secretary, John Healey, said: “Conservative ministers have given private housebuilders a free hand to make bumper profits off the back of homebuyers.

“Labour will turn the broken housing market on its head – putting low-cost new homes at the heart of our plan to rebuild Britain.”

The Office for Budget Responsibility, which provides the government’s official forecasts, in October said it expects the government to spend another £20bn on the help-to-buy scheme between the current financial year and 2022-23. The two-year extension of the scheme is expected to cost £7.3bn.

A Ministry of Housing, Communities and Local Government spokesperson said: “This government is committed to helping more people get on the housing ladder as we power through to delivering 300,000 homes a year by the mid-2020s. Our help to buy equity loan scheme has helped more than 190,000 households buy their home, helping to make the dream of home ownership a reality for a new generation.”

Source: Guardian

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