Procedure for accessing Family Homes Funds Construction Loan – Adewole

As more developers, embrace the Federal Government initiative of providing affordable housing to low-income earners through the Family Homes Funds, the question on the lips of developers is how can they access financing from Family Homes Funds.

To answer the question, the Managing Director of Family Homes Funds, Mr Femi Adewole,in a chat with Housing News,shed more light on how financing can be assessed.

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He said, ‘’we are currently providing capital for developers, whether private or public, but the key requirements are these; we only finance developers, who are building homes that fall within our target cost indicators, and they are challenging, that means that more slots exist for the one bedroom houses.

In terms of transfer cost; transfer cost been the price to the occupier, of no more than N2.5 to 3million . The two-bed being 4, to N4.5million, and the three-bed being N5.5 to N6million’’.

Speaking further he said ‘’we are basically financing 100% of the construction cost, and 15% advance payment to get you started, and in some cases we are also giving you an off take guarantee to de-risk the project for you. So it’s an extremely attractive package, because the intent is to bring supply at the level of the market for mortgage origination’’.

On the documents required by Family Homes Fund, he said,

‘’at this stage we are only looking for 3 or 4 sets of documents, number one, we need a very brief information on who you are, because you need to know who you are giving money to, how they are organized and how they handle money. And of course their experience and track record.

The second set is about the technical information, obviously your typical drawings, architecture, civil and all of that.

The third information that we need is the financial appraisal and assessment, and to make that easy for you, we have developed a fairly simple template, which we will e-mail to you and you can fill, and it basically tells you what is happening with regards to the cash flow and the viability of the project.

The fourth document is some statements around your marketing strategy, we want to understand what your strategy and your plan is for linking the production of the houses, to the buyers, that is an area that is of interest to us. So it’s basically as simple as that’’.

He added that interested developers can check the Family Homes Fund website to see the guidelines to developers for accessing financing from the Family Homes Funds.

 

Kenyans React to Weak Penalty for Corrupt Officials in Housing Fund

Kenyans have reacted angrily after discovering major flaws in the laws regulating the controversial affordable housing project.

The government on Tuesday announced employers would henceforth be required to remit a total of three per cent of all their employees’ salaries (1.5 per cent deducted from the employee and the other half contributed by the employer) at end of every month. The deductions were set to start on May 9.

This is despite a court order barring it from ordering for the deductions, until a case currently in court is heard on May 20. On Wednesday, though, the court issued a fresh order suspending the deductions pending the determination of the case.

But besides the legal battles, some of the regulations in ‘The Housing Fund Regulations 2018’, issued by the Cabinet Secretary for Transport, Infrastructure, Housing, Urban Development and Public Works James Macharia, provides for a fine of just Sh10,000 to anybody caught embezzling the funds.

Such culprits can also be jailed for a maximum of two years -or pay both the fine and serve the jail term. The fund is set up as part of President Uhuru Kenyatta’s Big 4 Agenda of affordable housing.

It is estimated that the levy will raise in excess of Sh57 billion annually.

HOUSING FUND

“A person who misappropriates any funds or assets of the Housing Fund, or assists or causes any person to misappropriate or apply the funds otherwise than in the manner provided in these Regulations, commits an offence and shall, upon conviction, be liable to imprisonment for a term of two years or to a fine not exceeding ten thousand shillings or to both,” part of the regulations on the ‘offences and penalties’ reads.

Kenyans have already opposed the move, calling for a review of the regulations in order to secure their money.

On Wednesday, Kenyans ran an online campaign against the housing levy fund, as they complained on the regulation gaps and lack of public participation before the regulations were enacted.

“I say NO to the Housing Levy Fund it needs to be amended. The poor will not benefit. Details in the prints,” Obuki Bwo’Obiero said.

Vincent maritime posed “Housing fund is a COMPULSORY saving scheme’ says Tuju. Who consulted us?”

“One day people will only be getting paychecks to show them how their salary was deducted and they owe the government some money because the salary was simply not enough…” said Emmanuel Lumumba.

Peter Mburu

UN Picks Kenya to Host Smart Housing Prototype

UN Environment, UN Habitat, the Yale Center for Ecosystems in Architecture and associated partners are working on designs for smart houses, one of which is on display at the UN Environment headquarters in Nairobi, Kenya.

Africa is urbanizing fast, as its population grows and many flocks to cities in search of jobs, education and healthcare. Studies show that hundreds of millions more Africans will live in cities over the next three decades.

Many of these new urban Africans, however, are likely to end up in informal settlements. Already an estimated 200 million Africans live in informal settlements—often without access to energy and sanitation.

The growing class of urban poor need access to decent housing. But the challenge is that the global housing sector already emits almost a third of global greenhouse gas emissions and uses up to 40 per cent of the planet’s total resources. New approaches are clearly needed.

 

As the housing sector grows—and it must grow if we want an equitable world—we need to reduce its environmental impact, not raise it,” said UN Environment Acting Executive Director, Joyce Msuya. “Smart design is the only way to meet our housing needs and stay within planetary boundaries.”

First unveiled at the fourth United Nations Environment Assembly, the 3D-printed modular structure, made from biodegradable bamboo, aims to spark ideas and debate on how future biomaterial processes can help meet the Sustainable Development Goals, Habitat III New Urban Agenda and Paris Agreement.

The pavilion shows how post-agricultural waste—like bamboo, coconut, rice, soy and corn—can be turned into construction materials. It demonstrates solar energy and water systems that make homes self-sufficient and zero carbon. It highlights how micro-farming can be achieved with plant walls. All these features, and more, are integrated, monitored and managed by sensors and digital controls.

“As urbanization gallops forward, people around the world are tired of seeing precious natural habitats paved over with toxic, energy-intensive materials such as concrete and steel,” said Anna Dyson, Director of the Center for Ecosystems in Architecture at Yale University. “In the 21stcentury, global construction practices must innovate towards nature-based solutions for future cities. Our research consortium with East African collaborators is devoted to advancing state-of-the-art locally produced building systems.”

It is fitting that the pavilion is based in Kenya, as the government there has prioritized affordable housing as a key pillar of its Big Four Agenda, which aims to make the East African nation an upper middle-income country by 2030. Over the next five years, the government plans to build over 500,000 affordable houses across the country to meet the ever-growing housing demand.

To achieve the low-cost housing agenda, however, the industry needs to embrace technological changes that will result in the use of innovative sustainable construction, the aggregate effect of which would be to lower the embodied energy and average cost of manufacturing and housing.

“Architecture must address the global housing challenge by integrating critically needed scientific and technical advances in energy, water, and material systems while remaining sensitive to the cultural and aesthetic aspirations of different regions,” said Deborah Berke, Dean of the Yale School of Architecture.

The pavilion serves as a starting point for those in government and industry to think about what they can do better. It is part of a series of demonstration buildings, which started with a 22-square-meter “Ecological Living Module”, powered by renewable energy and designed to minimize the use of resources such as water. This module was displayed at the United Nations High-level Political Forum on Sustainable Development in 2018.

Baraka Jefwa

5 million Housing Scheme to be Launched by Pakistan

Dubai: Prime Minister Imran Khan is set to launch on Wednesday his dream project of building 5 million low cost houses for the less-fortunate people in the country.

Minister for Information Fawad Chaudhry told reporters in Islamabad on Tuesday that Prime Minister Imran would launch the first phase of Apna Ghar (our home) Housing Scheme on Wednesday in Islamabad.

“The first phase will see the construction of 135,000 houses across the country,” he said.

A dedicated authority called the Naya Pakistan Housing Programme (NPHP) has already been created to manage the project under direct supervision of the Prime Minister.

The first phase will include launching of construction work for houses in Islamabad and Balochistan.

During his election campaign, Imran had promised to build five million housing units to overcome the shortage of affordable housing in the country. The housing scheme will largely be involving the private sector.

“There are 40 industries directly involved with housing. By inviting the private sector into this project we are opening the doors of entrepreneurship for young people,” said Imran.

He said that though constructing five million houses is an enormous task but once initiated, the number of houses being constructed will be increased with each passing year. The project will be carried out in phases.

Housing Finance

The Pakistan government will provide 90 per cent housing finance to deserving people as part of Imran’s flagship project of five million houses in the country.

Last month, Imran already launched a low-cost finance scheme to kick-start the housing project for the poor.

The project, he said, would also help boost economic activities through the creation of jobs and promote 40 industries connected to construction sector.

Imran said earlier that a huge segment of Pakistan’s population is cash-starved and could not afford to build houses, and that’s why the government is stepping in to help.

Housing units costing less than Rs3 million (Dh80,000) would be funded under the scheme. The banks would provide loan up to Rs2.7 million — 90 per cent of the total amount — under the scheme.

The banks and other financial institutions are being incentivised to extend loans for the scheme.

Special segments

Special segments, including widows, orphans, transgenders, martyrs’ families and people living in war-against-terror hit areas would be given priority under the house financing scheme.

The new housing units could neither be rented out nor sold by the owners. The low-cost financing would be made available to at least 100,000 housing units at the mark-up rate of 5 per cent for 12.5 years.

Currently, Pakistan has a backlog of 10 million housing units and bank financing is a must to achieve the target of constructing five-million low-cost houses.

Ashfaq Ahmed

Trump’s Tax reform is Contributing to the Housing-Market slowdown, New York Fed finds

The housing market has continued to cool this year, remaining a soft spot in an otherwise solid economy. And President Donald Trump’s tax cuts passed in 2017 appear to be partly to blame, according to a new study from the New York Federal Reserve Bank.

“Changes in federal tax laws enacted in December of 2017 have contributed to the slowing of housing market activity that occurred over the course of 2018,” economists Richard Peach and Casey McQuillan said in the report out Monday, though they added the results weren’t conclusive.

The Tax Cuts and Jobs Act was long expected to increase after-tax home ownership costs by capping the amount of mortgage debt on which interest is deductible, doubling Americans’ standard deduction and lowering marginal tax rates. Those changes reduced the apparent price tag of the plan, but drew widespread criticism from Democrats and some industry groups.

“Before the tax law, the incentive to purchase and even trade up was in the itemization of taxes,” said Jonathan Miller, the chief executive of Miller Samuel, a real-estate appraisal firm. “The ‘reform’ aspect of the tax cut replaces the direct messaging long enjoyed by housing.”

The tax overhaul came at the same time as higher borrowing costs, with the average contract interest rate on 30-year fixed rate mortgages climbing about 70 basis points between the end of 2017 and the third quarter of 2018. But the most recent slowdown was more severe than in two previous episodes when mortgage rates rose by a similar amount.

The New York Fed found the largest sales declines tended to be in the highest price ranges and areas with higher income and property taxes at the state and local level, where homebuyers would have been most affected by the tax changes.

For homes where the amount borrowed exceeds $750,000, for example, the economists said capital costs appear to have increased to 5% from 1%.

“Different provisions of the TCJA combine to increase the marginal user cost of capital for homeowners, especially for higher-priced homes and homes in high-tax jurisdictions,” Peach and McQuillan said.

While lower borrowing costs have drawn some Americans from the sidelines in recent months, gauges of the housing market have continuedto come in below expectations. In March, mortgage rates hit a 14-month low.

“This plan was introduced at the same time mortgage rates were rising so the cause of the slow down was less clear,” Miller said. “But today rates are now lower than they were a year ago so the slowdown wasn’t really about rising mortgage rates.”

Gina Heeb

N3.7bn Zuba Mass Housing ready by August – FG

The first phase of the Federal Housing Authority (FHA) Zuba Mass Housing Scheme project which began nine months ago will be commissioned in August this year.

The Managing Director of FHA, Prof. Muhammad Al-Amin, announced this during a recent inspection of projects in Abuja by the Minister of Power, Works and Housing, Mr. Babatunde Fashola. He said N3.7bn had been committed so far into the Zuba housing project.

The project in Zuba is a 764-unit of houses and is expected to be delivered to the masses by August.

Housing

The projects are among many others by the Federal Government spread across the country to deliver affordable houses to Nigerians.

Speaking with newsmen after the inspection of the projects, Mr. Fashola pointed out that the three sites represented the different ways government was addressing housing development in the country.

The minister, who said the FHA had not compromised on quality, noted that the project was the first set of buildings the FHA embarked on under the present dispensation, assuring that the ongoing projects would meet global minimum competitive housing standards for pricing when they were finished.

“They are not luxury apartments as you can see; they are mass housing projects, 764 of them, two and one-bedroom flats,” he said, adding that the aim of government was to get what would fit into the pocket of the ordinary man who “President Buhari and the Nigerian Government are very determined to reach.”

“It will meet those standards of safety; it will meet those standards of protection from water, wind and flooding. It will be efficient, but it is not luxury. You can now create your own luxury as you furnish, but it will meet the global minimum competitive standards for public housing in terms of quality and in terms of finishing,” he assured.

Fashola expressed satisfaction with the quality of work at the site, as well as the employment opportunities it provided, saying, “I met some carpenters who were helping to prepare the form work for houses on this site and they said they didn’t have work; they were roadside carpenters before, but the site provided opportunity for them to get work; which is what government wants to achieve; to use housing to stimulate employment.”

Fashola added that the report available to him showed that the site alone had employed 10,000 persons: builders, welders, suppliers and so on, and that there was assurance that employment would still continue as the houses reached the fitting and painting stages as “there is still a lot of work to be done.”

The minister explained that the type of buildings at the site were the condominium variety, different from the bungalows that most Nigerians were used to, expressing delight that many people had been afforded opportunity to work at different levels: supply of building materials; granite, cement, laterite, water and so on, adding that, “This is the construction ecosystem that we want to see across the country.”

Also speaking to newsmen, the Managing Director of FHA, Prof. Muhammad Al-Amin, said, “We have also taken measures that the end users of this projects are common Nigerians, as we are encouraging all sorts of groups to form housing cooperatives as it will help during housing allocations, and we are ensuring that it is those common Nigerians that are yarning for accommodation that will benefit from these projects and that is why we chose this location for this project. It is not in Maitama or Asokoro.”

Some workers and support staff at the site expressed joy over the project, saying it had helped a lot of unemployed people to return to work and help their families.

Housing

An engineer at the site, Kunle, said those who had no jobs, such as masons, carpenters and iron benders, were now busy doing something and earning a living.

A security man, Jacob Danladi, said, “We appreciate this government. I am very happy with the government over this project. I was employed last year. I want the project to continue because it is helping a lot of people.”

Another artisan who gave his name as Peter, expressed delight that he now had a job to help himself and his family, and therefore, urged government not stop the project “because it is helping us.”

Rosemary, a food vendor, described the project as people-oriented in terms of the opportunities it has afforded people to get jobs.

She said, “This project is very nice, everybody is working; I am doing business; selling food here to help workers. I make money to take care of my children. I am happy with the project going on here. God has already blessed this government. I only pray that they continue because they are helping me in my business.”

Malikatu Umar Shuaibu

Chellerams’ Workers Receive Home Renovation Funds from FMBN

The Managing Director of FMBN, Mr Ahmed Dangiwa, said the fund would empower the beneficiaries to put their homes in a better condition, adding that the bank’s target was to ensure many Nigerians had suitable houses to live in.

The 14 beneficiaries were given N1m each, which Dangiwa said was part of efforts by the bank to complement President Muhammadu Buhari’s housing sector reforms.

Dangiwa, who was represented by FMBN Zonal Coordinator, Lagos, Mr  Abiodun Fashina, said the bank would continue to keep its promise on homeownership to Nigerians.

He said, “FMBN has a mandate to provide affordable mortgages to Nigerian workers particularly low and medium income earners though the National Housing Fund scheme. The Fund is sourced from 2.5 per cent of the basic income of Nigerian workers earning the minimum wage and who are 18 years and above.

“The overall objective is to provide cheap source of loanable funds to nurture and sustain the mortgage industry and eventually facilitate affordable homeownership for the low and medium income group in the country.”

According to him, section 14(2) of the National Housing Fund Act Cap N.45 of 1992 stipulates that a contributor to the NHF can access loan from the Fund for the purpose of building, purchasing or renovating of existing houses.

“In order to achieve this, FMBN has developed concessionary loan windows to enable Nigerians access mortgages for home ownership,” he said.

He added that about N21.6bn had so far been disbursed by the bank to 26,275 beneficiaries across the country under the Home Renovation Loan window.

He, however, stated that the realisation of the mandate had been hampered by several challenges in the country including lack of access to land, among others.

“Inadequate funding for the housing sector, inaccessibility of mortgage loans due to lack of proper title to landed properties. Others are low income of prospective borrowers which affects affordability, cumbersome procedures for obtaining Governor’s consent to land transactions which is also costly,” he said.

The State Coordinator, Apapa office of the FMBN, Lagos, Mrs Okoli Uche, urged the beneficiaries to ensure the loans were used on the primary purposes they were given out.

Okoli advised Nigerians who were yet to get their personal homes to key into the ‘Rent to Own’ housing window initiated by the bank, adding that it would enable them to access a house and pay for maximum of 15  years before becoming the owner.

The Chief Executive Officer of Chellerams Plc, Mr Aditya Chellaram, said the gesture was a demonstration of the company’s unique concern for the welfare of its staff through partnerships and collaborations that would address their housing need.

Architects To Advise Lagos on How to Review Urban Plan

The Nigerian Institute of Architects stated that the processes, through which the city would become a smart and resilient city where things work for all, would form the basis for discussions at this year’s Lagos Architects Forum.

The Chairman, NIA, Lagos Chapter, Mr Fitzgerald Umah, said the forum would focus on Lagos urban re-generational plans and new opportunities; values and positioning for architecture; rethinking going global and new directions for building materials technology among other issues.

Umah said the ‘LAGOS 10.0 – An Architectural Regeneration 2: The Lagos Response’ scheduled to hold  May 8 to 11, would consolidate on the gains of the 2018 forum.

“This year marks the 10th anniversary of the increasingly popular international conference and the three-day event will devise new ways of running practices and boosting stakeholders’ engagement and adaptation to local economies,” he said.

Umah said there would also be a focus on building collapse in Lagos, adding that most of the distressed buildings were collapsing from the base structures where the service of professionals were not engaged before raising new super-structures on them.

While calling on the Nigerian populace to engage the right building professionals in each phase of the design and construction process, he said the chapter had been working with the Lagos State Government to ensure that the action documents handed to the state during past LAFs were properly adopted to stem the tide of building collapse.

He said the forum, through its ‘Lagos Home Design Competition 2019’ “would also come up with prototype designs which would lead to the creation of an utopian community that would make houses more affordable to people in the society.

The General Secretary, NIA, Lagos Chapter, Mr Abiodun Fatuyi, said the forum would also feature ideas competition organised through a partnership between Sterling Bank Plc and the Lagos Architects Forum, to discover innovative designs that would drive adequate policy plans on affordable housing in Lagos.

Maureen Ihua-Maduenyi

Chinese Firm Reveals Long Term Investment Plans in Nigeria’s Housing and Other Sectors

A Chinese company, Sinoria FABCOM, which is a subsidiary of one of China’s business conglomerates, Sinoma, has stated that its aim is to pursue long time investment in the housing and building industry in Nigeria and to establish an enduring partnership that would see to the overall development of the sector.

FABCOM which manufactures building items such as stone coated roofing tiles and fiber cement board has been operating in Abuja for about 7 years now. Speaking with newsmen in Abuja, the deputy managing director of FABCOM, Mr. Jackie Dai Hui said “We are investing in Nigeria and we have come to stay here for a long time to contribute to the economic development of the country, especially the housing sector, but in doing that we cannot compromise our standards.”

 Chinese

READ ALSO: NIGERIA’S HOUSING DEMAND INCREASES AGAINST SUPPLY, ECONOMIC GROWTH

He stressed that the focus of his company is to change the poor perception people have about Chinese products by making quality the watchword. He also explained that the company has since 2008, ended Nigeria’s dependency on importation of cement and some other building materials through its servicing of the leading cement companies in the country.

ABAH ADAH

Nigeria

Nigeria’s Housing Demand Increases against Supply, Economic Growth

Although the economic growth of Nigeria is not growing, the population of the citizens cum visitors do not wait either as both are surging despite sluggish economic growth. The United Nations (UN), last year noted that Nigeria’s population stands at a 180 million with an annual growth rate of 3 per cent as of 2015 and an urban population growth rate of 5 per cent. 

Data from the World Bank and the National Bureau of Statistics also stated that there is a 17 million housing deficit in Nigeria even though, the figure has trended for longer period. Globally, 1.6 billion people live in sub standard housing according to UN statistics. In Nigeria, over 100 million of its 180 million citizens live in substandard housing.

Yemi Adelakun, one of the high fly executives for Nigeria Integrated Social Housing(NISH) commented that the available houses built do not meet to the needs and affordability of the people hence making bridging the housing deficit difficult. This deficit has not helped affordability in any way.

READ ALSO: PETROLEUM MARKETERS TO BUILD 10,000 GAS PLANTS ACROSS NATION

Nigeria

It was ascertained that about 3,000 to 6,000 affordable housing are under construction in Nigeria with 1,400 houses in Nassarawa state alone. Mr. Adeyemi Dipeolu, the Special Adviser to the President on Economic said that with hope of Nigerians accessing the housing units under the affordability index, the the Ministry of Power, Works and Housing has managed to complete more than 2,000 houses in 72 units across Nigeria. This, no matter how fanciful it looks, the fact remains that housing deficits keep increasing with government being handicapped on how to handle it. This is worsened with many of the standing houses collapsing and reducing the already short- in- supply houses.

In regards to high mortgage, Mr. Dipeolu said that it would be a challenge for Nigerians to access homes with the high mortgage rates. “ The government is working to ensure that there are cheap mortgage  available for Nigerians.”

Senior Special Assistant to the President on Infrastructure, Imeh Okon also confirmed a report saying that government would issue US $275m yearly for a five year period. The projects, despite being powered by the FHF will also according to her, involve private sector participation.

Okon confirmed that under FHF, Nigerians earning even US $83 can afford a home which covers the government’s main aim of providing social and affordable homes. The latest report on Nigerians searching to buy or rent apartments that meet their needs by Reuters indicated that the number of the potential housing buyers and tenants was surging by the day, in spite of the sluggish growth of the nation’s economy.

Nigeria

According to the latest news sourced from the online medium, such Nigerians searching for their dream home to buy or rent are turning to the internet in droves, leading to a surge in the number of property-focused technology firms. The growing number of ‘home searchers’ or the emergence of the “proptech” companies is attributed  to the country’s rapid population growth, faster broadband speed and cheaper smartphones that have also benefited other sectors from retail to gambling in the last few years.

With about 180 million population, the country has the highest number of internet users in Africa, with approximately 107 million internet data subscribers, representing an increase of about 85 percent over 5 years. The news indicated that Nigeria’s rapidly growing proptech companies typically adopted a subscription model, charging property agents a listing fee and property developers a commission on completed transactions.

Source: SunNg

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