South Africans care more about their cars than their home loans-Report

In a study believed to be the first of its kind in South Africa, TransUnion, a leading global risk and information solutions provider, today revealed which debts consumers prioritise during times of financial stress. 
Contrary to conventional wisdom, people don’t always look to safeguard home loans; rather, they look to protect their automobiles, paying vehicle loans in preference over other forms of credit.
The research, which observed the payment behaviour of approximately 325 000 South African consumers, looked at borrowers with at least one of each of the three primary credit products: a credit card, a vehicle loan and a housing loan.

The study tracked them over time to see what happened when they were unable to meet all their credit commitments, and how they prioritised which obligations to pay above others. This study is important in better understanding the consumer thought process and the choices they make regarding their debt obligations during times of financial stress. 
Understanding the ‘payment hierarchy’
The payment hierarchy is a common term used in consumer lending and refers to the priorities that consumers place on different credit products when they are facing financial stress and don’t have enough money to pay all their obligations. It looks at which payments people prioritise and pay first, and which they place a lower priority on and pay last.
When faced with the choice of which debts to pay and which to miss between a popular set of credit products — credit cards, vehicle loans and housing loans — conventional wisdom may suggest the first product type to enter delinquency (i.e. the one consumers would miss a payment on first) would be a credit card, followed by a vehicle loan. 
Further, it might be expected that only in the most dire of circumstances would consumers stop paying housing loans, prioritising those payments above all other debt types. The rationale, so the conventional wisdom goes, is that missed payments on a card do not put any important collateral at risk, automobiles are critical for efficiently getting to daily activities, and of course the home is the centre of one’s family life and the most important asset a consumer can own.
However, the TransUnion study revealed that the most commonly seen hierarchy among this set of products is in fact different than conventional wisdom would suggest. Consumers generally place vehicle loan payments first, prioritising those payments ahead of home loans. Credit cards, as expected, are the product in this set that consumers prioritise last and are most likely to miss. 
These study findings do not constitute a recommendation of what choices a consumer in financial distress should make, but rather are observations and insights into the decisions they do make. 
Delinquency rates (one month or more in arrears) after 12 months for consumers who possess and are current on all three credit products at the beginning of the respective performance measurement period.
“It might feel counterintuitive that, for most struggling consumers, vehicle loans are prioritised over other prominent credit products such as mortgages,” said Carmen Williams, Director of Research and Consulting for TransUnion South Africa. 
“However, there are a number of important factors to consider. It’s not always about protecting your home; it might be the size of the payment required, access to other forms of credit and even what you feel the perceived consequences might be. Consumers and lenders alike often have to wrestle with these problems, and our study looks to shed light on some of the difficult decisions consumers sometimes have to make.”
Key findings
Cards came last: There are numerous potential reasons for this lower priority on credit cards: lesser perceived consequence (i.e. not forfeiting ownership of a car unlike with a vehicle loan), the availability of substitutes for smaller everyday spends (such as cash or digital payments if still available) or even the access to other sources of liquidity (such as personal loans or retail finance).
Vehicle loans prioritised over home loan payments: There are a number of potential reasons why vehicle loans sit above home loan payments in the payment hierarchy. In the majority of cases, the average vehicle loan has a lower monthly payment compared to a housing loan. Missing a mortgage payment would generally give the consumer more cash flow relief and enable them to meet other obligations. As well, there are many viable rental alternatives to home ownership; in contrast, public transportation is usually not an efficient alternative to owning an automobile.
The timing of any perceived consequence might also be a factor. Consumers likely recognise that a vehicle could be repossessed relatively quickly after missing just two or three payments, whereas eviction because of default on a home can often take many more months or even years. Finally, a vehicle may be the primary transport to work, or even looking for work, if suitable public transport options aren’t available, making continued access to a car critical to preserving a consumer’s source of income.
As part of this study, TransUnion also explored the payment priority among popular unsecured credit products, specifically credit cards, personal loans and retail store accounts. Unsecured products are typically used to finance small purchases and day-to-day living expenses. When looking at roughly 375,000 consumers with this basket of popular unsecured credit products, conventional wisdom again proved wrong. The assumption historically has been that consumers would base their payment hierarchy on the concept of future utility, prioritising credit cards over other forms of popular unsecured credit as a credit card would still be available for further use across other purchases, potentially with multiple merchants. Retail store cards would be next—again, because future utility exists (although only with a single merchant). Finally, personal loans would be last because the funds have already been received and spent, and the loan would be perceived to have no future utility.
However, the TransUnion study revealed that the most common unsecured credit hierarchy saw personal loans given the highest priority amongst consumers during times of financial stress. Next came credit cards, with retail cards at the bottom of the hierarchy.
Key findings for popular unsecured credit products:
Personal loans prioritised over other products: This may, in-part, be due to the prevalence of debit orders for personal loans which are fixed and are often a non-negotiable condition of the loan. Thus, the consumer is less likely to “choose” to pay their personal loan or not, but instead has the loan payment automatically debited, leaving them to make their payment choices among the remaining products.
Credit cards are paid ahead of retail store cards: Here the concept of future utility may in fact influence consumer choice, as paying their credit cards allows them more flexibility to make future purchases from a wide range of merchants compared to their retail store cards.
There are other likely reasons for the priority of personal loans in the unsecured product payment hierarchy. For example, personal loans have a fixed end date, and consumers can see a ‘light at the end of the tunnel’ in the near-term if they continue to meet their obligations, giving them relief from this one debt obligation. This contrasts with credit cards and retail store cards, which tend to have no set end date and could potentially continue indefinitely if consumers make only minimum payments on these obligations, and then charge up the remaining available credit in the next month.
Difficult Choices During Difficult Times
Williams concluded: “This study is not about delinquency. Rather, it is about choice and the consumer thought process during times of financial stress. When people miss a payment it is often because of significant life events – loss of a job, a relationship breakdown, illness or even other unexpected bills. They are not choosing whether they want to pay or not, but rather are making choices to maximize the benefit of the scarce funds they have available. The choices people have to make are often difficult, and our research gives a glimpse into some of the factors that are potentially important. 
“Lenders need to understand the choices that consumers make across their wallets and the interaction effects between different product types in order to inform their underwriting and risk management strategies. Payment hierarchies are extraordinarily complex and dynamic, and can be impacted by external drivers such as unemployment rates, income levels and home prices. As these drivers shift, so can the hierarchy – and the recent economic headwinds could certainly alter consumer priorities regarding their financial obligations. Lenders should always be actively evaluating, refining—and when necessary, redeveloping—their consumer mindset models, in order to anticipate and be able to quickly react when borrower or economic conditions change.”


How Big Data Can Prevent Homelessness

Professor Vania Sena believes the swathes of data that councils already hold on us could be used to prevent homelessness.

The University of Essex researcher is working with Suffolk and Essex County Councils to analyse large sets of citizen data, collectively known as Big Data, using algorithms that will be used to predict when people need help.

If data analysis and predictive algorithms sounds cutting-edge, Sena says the actual models being used are very basic. “We’re not talking here about sophisticated artificial intelligence,” she says.

But simple as they may be, the systems work much faster than any human and are better at spotting financial patterns than us mere mortals. No wonder then that so many councils in the UK and elsewhere, including San Francisco, are trialling the technology.

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Prevention is cheaper than cure

Councils are under increasing financial pressure due to the drastic cuts made by central government in the name of austerity. Local Government Association figures paint a gloomy picture of a 77 percent decrease in central government funding between 2015/16 and 2019/20, hacking the £9,927m local authorities received in 2015 down to £2,284m. With budgets feeling such an enormous squeeze, it is vital that preventative measures – which save money in the long run – can be put in place.

By the time someone becomes homeless, it’s harder to help them and costs more – a person sleeping rough for 12 months costs the public purse £20,128, according to crisis. When offset against the cost of a successful intervention – £1,426 – preventing 40,000 people from becoming homeless could save the taxpayer £370m per year.

That’s why the Essex University academic sees predictive analytics as so important. The predictions can be used to identify individual households who may require more support. But perhaps more importantly, they are also able to create a hotspot of communities that are under most pressure.

“The council can then work with the community on a comprehensive set of interventions, to try to reduce the risk that each individual could face,” says Sena.

No algorithm is perfect, however. And Sena accepts that their analysis is only as good as the data held by councils.

The good news for anyone worried about how their private records are being used is that it is all anonymous. Sena and the team receive no information as to who any of the individuals are. But the results they come up with can be mapped back on to our council records to predict who is most likely to need housing support based on their use of council services and financial standing with the council.

But there could be serious benefits for people and budgets if interventions happen sooner and are targeted more accurately. That’s why Luton Council, where Nikki Middleton is head of customer service, has also turned to the idea of Big Data and predictive analytics.

“We wanted to do some analysis around what the level of need was, as we suspected we could be working with people sooner,” explains Middleton.

The council worked with Policy in Practice, a social-focused software company, which analyses housing benefit and council tax records in a data dashboard, making it easier to identify specific households needing help and wider trends, such as how a specific policy change will affect citizens.

What if we could offer help earlier, before somebody is in crisis?

“We get a real clear picture of where they are now, and where they’re likely to be in the future,” says commercial director Jade Alsop. “It’s very different to how others do data, as government and others look at how one reform impacts many individuals. What they won’t get is all of them combined, and the knock-on effect that each of them have on each other.”

In Luton, an algorithm wasn’t necessary to assess need, as they found that everyone who came to the council for general services or support had as high or higher need for housing assistance than those specifically asking for it.

“If you’re coming in through the front doors, there’s a level of need that is not typical of the population in general,” Middleton says. “They’re probably on a trajectory to asking for help in the future. What if we could offer help earlier, before somebody is in crisis?”

Middleton adds that it “feels a little bit uncomfortable” to sift through data looking for struggling households, and added the information changes so quickly that it can go out of date. When Universal Credit was being rolled out, the Department for Work and Pensions provided a list of households impacted – but it was difficult to target support based on that data because it changed month to month, she adds.

The Big Issue has inspired the launch of 120 street papers globally, including sister titles in Australia, South Africa, Japan, Taiwan and Korea.

The council is analysing its data, but rather than proactively targeting individuals the aim is to build evidence proving that earlier interventions are helpful. While it seems clear to Middleton that prevention is the answer, that’s not so obvious to others – and having data helps confirm it.

“Particularly in this climate, it’s not enough to know that it’s the right thing to do – we have to be able to prove it,” she says.

When it comes to tackling homelessness, prevention is better and cheaper than cure. Essex, Suffolk and Luton are among those hoping to revolutionize support to prevent homelessness by using Big Data.

But they are not the only ones – the think tank Local Government Information Unit held an evidence session on data and prevention in October last year as part of its analysis of the Homelessness Reduction Act in its inaugural year.

At the session, Hackney Council told of its efforts with data while Bristol City Council presented its government-funded Trailblazer system used to identify at-risk households. Croydon Council also spoke of how its Gateway system has been used to reduce homelessness over the last three years.

Councils around the country are watching and waiting, because if Big Data has a big impact on homelessness numbers in these early-adopting areas then we can expect the data-led prevention revolution to sweep the country.


How Population In Nigeria Affects Housing and Real Estate

It is not news that man’s basic needs are food, clothing and shelter. It is, however, clear that in Nigeria today, adequate shelter is still a national headache. Urbanisation is taking over major cities in the world, and Nigerian cities are not left out. Rapid population growth in Nigeria and increasing urbanisation have made shelter one of the most critical problems currently facing the country. Apart from multi-storeyed buildings, traffic jams and street beggars, one of the central “faces” of Africa’s rapid urbanisation in most if not all of its large cities is “non-standard, poor-quality housing units” which the UN calls “urban slums”.

There is a shortage of houses in the Nigeria, the houses that are built cost too much or of poor quality, and are often in the wrong places. As Nigeria population continues to grow rapidly, it will place further pressure on housing and the environment. The birth rate in Nigeria is high and the rate of rural-urban migration is high. All these contributes to housing shortages and burgeoning prices.

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Nigeria’s Population over the years

Nigeria is located in western Africa on the Gulf of Guinea and has a total area of 923,768 km2 (356,669 sq mi), making it the world’s 32nd-largest country. The population of Nigeria represents 2.35 percent of the world’s total population which arguably means that one person in every 43 people on the planet is a resident of Nigeria. Looking back, in the year of 1960, Nigeria had a population of 45.2 million people, but now her population is estimated to be over 182 million people.

The level at which housing and infrastructure of urbanisation have been provided to encounter this rise has remained low, leading to the insufficient housing to the continuous increase in the population of the country.

The situation is quite the opposite in the largest state in the country. The largest state in Nigeria, Niger state, has over 4 million residents. The number of dwellers in the land cannot be compared to that of Lagos, which has a population density of over 20,000 persons per square kilometre

Unfortunately, despite this housing situation in the country, a certain minority are living a life of affluence while the rest of her members are living in a state of hardship. There are certain people who own more than one house in the country and these houses don’t have occupants. The available housing option is quite expensive as the average standard 3 bedroom apartment goes for N300,000.

The selling point of these urban dwellings are the economic opportunities and better infrastructures available. People consider migrating to the cities because of the hope of better living conditions, which unfortunately is not the case. When migration levels increase and more people come to an area, either from other states or regional areas or from other countries, then typically the demand for housing increases. This, in turn, tends to push property prices up in both capital value and in rental value. Affordability of housing becomes an issue, as most household won’t be able to afford this. The bottom 40% of income distribution spend more than 30% of their household income on housing, adjusted for household size.

This moves them to consider slum areas as options for affordable accommodation. These areas are overcrowded and lacking in standard conveniences such as electricity, water, drainage and health services.The overpopulated cities also have a large number of people who don’t even have any type of accommodation. These people sleep under the bridges and in “safe” places on the road.

People living in Kano state the commercial hub of the north are also experiencing housing difficulties. The number of people living in Kano state is estimated to be over 10 million. The urban low-income groups are experiencing housing difficulties because of their socioeconomic disadvantages.

The overpopulation problem in the country can’t be stopped, but it can be controlled and maintained. Addressing population growth does not tackle the housing crisis in the immediate future, but it has a vital role to play in long-term housing problems.


Population growth and housing in Nigeria

The relationship between population and housing is two-sided. On the one hand,population change leads to a changing demand for housing. Population growth, and particularly a growth in the number of households, leads to a growth in housing demand. Population decline might lead to a decrease in housing demand. This will,however, only happen in the long run, after not only the number of people but also the number of households has started to decline. The danger of population decline is greatest in remote rural areas and in areas with lower-quality housing.At the same time, the supply of housing influences the opportunities for population increase through migration. Adequate housing supply might attract migrants or influence their choice of residential location. This mechanism, however, mainly operates for migration within countries and much less for international migration. Usually, homeowners are considerably less likely to migrate than renters. This is partly the result of the fact that the transaction costs of moving are much higher for owners than for renters.

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So, if the level of home-ownership is too high in a country,this might seriously hamper the spatial flexibility of the labour force.Housing supply may also play a decisive part in leaving the parental home and
the formation of married and unmarried unions. It is even likely that the supply of housing plays a part in the timing of fertility or the number of children people have.
The best opportunities for leaving the parental home and family formation are arguably found in a situation where housing quality is high and access is easy, or in a
situation where quality and prices are diverse and there is an adequate supply of affordable rental next to owner-occupied accommodation.

Rapid population growth rates coupled with low levels of economic development in developing countries have created among others immense obstacles to the provision of adequate housing to the majority of residents. Population growth rates are growing faster than the provision of new housing and housing infrastructure. This has resulted in intensive usage of the existing stock of housing and deterioration of housing environments.

The performance of the housing sector is one of the yardsticks by which the health of a nation is measured. In most developed economies, the housing sector is seen as an important sector for stimulating economic growth.

Nigeria is the most populated nation in Africa. It is also one of the most rapidly urbanizing countries in Africa and over 48% of the population in Nigeria lives in the urban areas, covering less than 10% of the habitable land areas.

With an estimated annual national population growth rate of just over 2% and an annual urban population growth rate of about 4%, Nigeria has a population that is becoming more and more skewed to the urban areas, towns and cities.

Nigeria with a population of about 180 million people is currently facing a national housing deficit of about 17 million units. In 1991, the Nigeria housing deficit was at 7 million, it has since increased from 7 million in 1991, to 12 million in 2007, 14 million in 2010 and currently 17 million units.

The implications of this very high housing deficit is that tenants in rented apartments pay as high as 60% of their average disposable income far higher than the 20-30% recommended by the United Nations.The ever continuous increase of Nigeria’s population far outstrips its housing needs with the direct consequence being lack and inadequate housing. With a population growth rate of 2% in a population of 180 million, the current housing production of 100,000 units is not good enough.

with an estimated annual national population growth rate of just over 2% and an annual urban population growth rate of about 4%, Nigeria has a population that is becoming more and more focused to the urban areas, towns and cities.

The high growth rate of the urban population arises from both a higher birth rate and more importantly the increasing rural–urban migration. More and more people move away from the rural areas, abandoning their homes and occupations for the supposedly better infrastructure and better job opportunities of the cities.

This trend in population growth, coupled with expanding economic activity and rising rural-urban migration has put much pressure on the existing housing infrastructure. This is causing pervasive housing crisis, particularly in the urban cities and other highly habitable areas. This has increased demand for housing over the last two decades resulting in overcrowding and increased number of slum communities.



The battle for market share is nothing new in the mortgage lending business. However, as lending standards have become more stringent and home loan volumes have diminished since the housing market heyday, smart mortgage lenders are turning to data to obtain an advantage in this highly competitive market. Data is helping mortgage lenders in a multitude of ways, including:

• Originating more loans
• Increasing customer engagement
• Providing customer and market intelligence
• Driving high quality loans
• Obtaining recorded documents

Competitive mortgage lenders are using data insight throughout the mortgage process to increase their market share of new home loans while improving mortgage quality – an imperative for lenders in the post-boom mortgage market.

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Boosting Loan Originations with Insight

Lenders are increasingly using data to aid the loan origination process, both for current customers and non-customer prospects. At most banks and credit unions, loan officers are able to electronically pull up customer information including any product history with the institution before approaching a customer.  But that only tells a part of the story, particularly when many customers keep accounts with other financial institutions. So, rather than going into a customer call with simply an address, name and a list of current financial products the customer has used, loan officers with data-savvy lenders are now supplied with property and borrower data which allows them to better understand the customer’s situation. With the name and address of a customer, a loan officer can view the subject property and surrounding area, current ownership and liens on the home if applicable, approximate property value, and recent sales in the area. This information prepares the loan officer to have a more effective conversation with a customer, and provides a higher likelihood of closing the loan.

Measuring and Enhancing Customer Engagement

Often it isn’t obvious when customers maintain deposits at one institution and obtain other services elsewhere. But it does matter to smart lenders who seek to increase the long-term value of that customer. And a search of the data will reveal this. Smart lenders are data mining their customer databases to help understand and increase their customer’s connection to the lending institution. Does the customer have a credit card? Checking account? Savings account? Certificate of deposit?  Personal loan?  Auto or home loan? The more points of connection between the customer and the banking institution, the stronger the relationship, and the more likely the customer will remain to save and borrow there. Many banks and credit unions strive to achieve at least three points of connection – in any form – to help ensure customer engagement or loyalty to the institution.

Savvy banks and credit unions are using this analysis to help increase their customers’ relationship with them. Customers with too few points of connection are flagged to receive marketing messages and promotions about products that could deepen their connection. Also, these customers are identified for further outreach.  And when the customer calls or visits the retail branch, a representative will pull up the customer’s information on screen, mention that that they don’t have a credit card or loan and ask them if they would consider one at that time – potentially increasing their points of connection.

Providing Customer, Property and Market Intelligence

Once a bank or credit union has evaluated a customer’s engagement and identified that the customer does not have a home loan with the lender, it’s important that they take the next step to find out the lender that currently has their mortgage. This information as well as important facts about the type of mortgage and any other liens on the property, will provide a better understanding of the customer’s needs and current situation. This insight is available to lenders through two key methods:  Using customers’ names and addresses, lenders can use a property information database to pull up mortgage information on each property, one by one, including the lien position of the mortgage and the type of loan (e.g., FHA, VA or conventional).  Or they can work with a property data provider who will match and append the mortgage information and/or listing information to each and every customer. Through these methods, the lender can determine which customers may be candidates for a home equity loan or line of credit, or whether they may be ready to move to another property and be receptive to a future purchase loan. Lenders can also use these property research methods to market to non-customers in areas they wish to reach.

Once the mortgage information and/or listing information is obtained, an analyst or marketing representative can segment customers to receive specific marketing messages and to receive follow-up contact from a loan representative who will be apprised of the customer’s needs.

Driving High Quality Mortgages

Originating high quality home loans begins with data. By verifying property, ownership and lien information at the earliest stages of the loan process, lenders can help increase loan quality, reduce wasted time, and speed the time to close. The use of an online property research database can give lenders the means to quickly verify property ownership, property characteristics and current liens, and pull recorded documents as needed.  It is also helpful for lenders to see an overlay of property values on a map to provide loan officers a quick estimation of the property values in the area.

To further reduce the potential for fraud and misrepresentation in loan applications, lenders should also gain access to a full text search of recorded documents to identify undisclosed liens or property ownership nationwide.

Obtaining Recorded Documents Expeditiously

Obtaining all of the required documents in a timely manner to fulfill a loan file can be a challenge for lenders, but it’s a necessary task in order to remain in compliance with regulations. Often lenders would have to search county sites and wait as much as five days for third parties to find and deliver the needed information. And sometimes an improperly indexed document cannot be located. But lenders can streamline this process with access to an online property database. By accessing the latest property database with a full text search function, lenders can search billions of recorded documents to instantly find, in most cases, the documents they need to complete the file.

“A great tool for credit unions to use is DataTree by First American, the advanced property research database that helps lenders originate more high quality loans and obtain data and documents…”


Smart Solutions That Help Lenders Close High Quality Loans

A great data tool for mortgage lenders to use is Data Tree, the advanced property research database that helps lenders originate more high quality loans and obtain data and documents needed to complete the loan process efficiently, while mitigating lending risks.

DataTree helps mortgage lenders speed loan origination and review by providing:

1. Quicker verification of property ownership, legal description, valuation and liens needed by lenders to qualify the borrower and property. DataTree makes researching by APN, address, map or homeowner name easy and efficient.

2. Greater confidence in data through access to the industry’s largest database of property and homeowner information through Verified Record – which digitally matches key fields in standard conveyances and mortgages against multiple, independent sources.

3. The Power of FlexSearch, which allows lenders to conduct nationwide searches instantly for any name or phrase contained within billions of recorded land documents such as deeds, judgments, liens and releases. This makes it possible to locate hard-to-find or improperly indexed recorded documents.

With DataTree by First American, mortgage lenders benefit from the most advanced property, homeowner and mortgage information solution at all phases of the mortgage cycle – from customer acquisition to providing the data, property reports and insight that empower zero defect loans. DataTree can be accessed at as well as within FraudGuard®, where users can get seamless, one-click access to DataTree’s property and homeowner data research.


Reasons Why Modular Construction is Better than Traditional Building and Construction

Modular construction has taken the construction industry by storm, and there are many good reasons why. With modular construction, businesses can save time, effort, money, and resources, and benefit from a safer way of constructing various building elements and extensions. But what exactly is modular construction, and what makes it different from traditional building and construction? More importantly, how can it be fully utilised and optimised in the sector? If you are planning construction and building work or are in the first stages of planning a building and construction project, it may do you well to consider modular construction. Here are the top reasons why modular construction is better than traditional building and construction.

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What it is

Modular construction, in its essence, is simply the use of pre-engineered or pre-fabricated modules or units which are then installed on a construction or building site as a fitted as well as fully-serviced ‘block’ or unit. More clients are going for modular construction because it allows them to take advantage of a faster speed in construction as well as better quality. It also provides for enhanced economy of scale and a safer construction and building site overall.

Lightweight steel framing is essential in modular construction since it is not only light but also strong and durable. The proper framing also allows for better and more enhanced accuracy when it comes to the units which are built, and it allows for modular construction and structures to be used in a wide variety and range of applications. Modular construction in the UK today follows the highest British Standards and other guides for design.

Where and how it is utilized

It may not be surprising that modular construction has been widely used in Scandinavia for many years; the Scandinavian countries, after all, are known for their innovative approach to traditional building and design. But modular construction is also now being optimised in many other countries around the globe, and this includes Japan and the United States. In these countries, modular buildings are not only used as stand-alone units; they are also utilised as building extensions (where they are attached to the sides of existing structures) or as roof-top units.

The different reasons why modular construction is better than traditional construction

  • Modular construction offers decreased costs of construction, particularly when you combine it with a production-based economy of scale. In fact, it can reduce the costs of construction by as much as 10%
  • Modular construction offers a decrease in time of construction on-site by as much as 50 to 60%s
  • Modular construction can increase productivity on site by as much as 50%, since most of the activity is done off-site, hence decreasing disruption on-site
  • Modular construction offers better certainty in regards to the completion of a project on time – and on budget as well
  • Modular construction provides better use of materials (and less wastage), not only on-site but also in the manufacturing stage
  • Modular construction offers better quality and reliability, as everything is done according to set standards and quality control procedures

Modular construction has been used in the hospitality industry (in the development of travel lodges and inns), and it has also been used for residential buildings, hospitals, and retail buildings and structures. In many parts of the UK,modular classrooms are continuously being built, and modular structures are also used now as accommodation for students.

2018: The Events That Made Headlines In The Housing Sector

As the 2018 waned down, the country’s built environment witnessed both high and low events during the year under review. The sector, which was budgeted over N30bn for by the Federal government was beehive of activities throughout the year. However, some experts are of the views that Public-Private-Partnership would move the sector forward.

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Real Estate drives Nigeria’s economy in 2 Q

The year 2018 ended on a good footing as the real estate and the construction sectors were listed in the non-oil sector that drove the country economy in the second quarter of the year.

The National Bureau of Statistics (NBS) in its released Gross Domestic Product (GDP) figures for the second quarter of 2018 indicated that for the first time since the country’s exit from recession in 2017, economic growth was driven by the non-oil sector.

According to the report, the non-oil sector expanded by 2.05 per cent and contributed 91.45 per cent to the nation’s Gross Domestic Product (GDP), compared to 90.96 per cent recorded in Q2 2017.

It indicated that the construction sector grew by 7.66 per cent in Q2 2018 from -1.54 per cent in Q1 2018 and 4.14 per cent in Q4 2017.

Although, the real estate sector contracted by -3.88 per cent in Q2 2018 from -9.40 per cent in Q1 2018, it was higher than the 5.87 per cent reported in the preceding quarter.

The cement manufacturing sector grew by 3.84 per cent in Q2 2018 from 5.28 per cent in Q1 2018 and -1.92 per cent in Q4 2017, as well as wood and wood products by 2.23 per cent in Q2 2018 from 1.53 per cent in Q1 2018.

FMBN relaxes conditions for accessing housing loans

Another major event in the sector in the year under review was the relaxation of the conditions for accessing mortgage funds from the bank. Under the new conditions Nigerians above 18 with a steady pay check will now be able to access up to N5 million housing loan from the Federal Mortgage Bank of Nigeria, FMBN,  without equity contribution.

The revised requirements are a 100% reduction in the equity contribution required of beneficiaries.

In the old order, beneficiaries had to contribute 10% to access up to N5 million, 20% on N10 million and N30 million to access N15 million.

With the new conditions, an equity contribution of 10% will be needed for funds between N5 and N15 million for contributors to the National Housing Fund, NHF.

ARCON, CORBON move against quacks

IN 2018, the Architects Registration Council of Nigeria (ARCON) and the Council of Registered Builders of Nigeria (CORBON) expressed their readiness and willingness to move against quacks in the built sector.

On its part, ARCON announced that it has set up a projects registration number system, while CORBON disclosed that it had reached out to stakeholders in the industry to regulate the sector.

According to the ARCON President, Dipo Ajayi, the association intended to combat the scourge of building failure and collapse through the elimination of quackery, just as he disclosed that only fully registered and financially current architects and architectural firms would prepare, produce and submit designs for planning and implementation approval and receive such approvals when given.

Also, the CORBON Chairman, Prof. Kabir Bala, said that the council was reaching out to relevant stakeholders in the building environment for synergy in enforcing laws to regulate products and processes which are inputs for the production of buildings.

 Fashola faults housing deficit figure

In the year under review, the Minister of Power, Works and Housing, Mr Babatunde  Raji Fashola, queried the criteria used to arrive at the Nigeria’s 17million  housing deficit figure, saying that figure was not verifiable and accurate.

He said: “ But before I continue, permit me to indulge those who spend their time on the debate about the size of the deficit and ask how educated and informed that debate is. Who conducted the census that produced the figures in the deficit?

“Who verified the figures that now seem to trap many of our people in a vortex of difficulty? Does the deficit take into account the empty and unoccupied houses in every State of Nigeria?

FHA’s landmark achievements

In 2018, the Federal Housing Authority (FHA) recorded some landmark achievements, which included the plan to establish the Federal Housing Facility Management Agency (FHFMA) that would manage estates nationwide.

The Managing Director of the Federal Housing Authority (FHA), Professor Mohammed Al-Amin, who announced this, remarked that the agency would see to the infrastructural development of federal housing estates and other housing estates in the country.

In the same year, the agency acquired a 800-hectare of land for the construction of the Diaspora Estate in Abuja. The estate, which will be located in Maitama 11 area of the Federal Capital Territory, FCT, Blueprint learnt is designed for Nigerians in the Diaspora, the diplomatic corps and eminent Nigerians.

In the year under review, the agency also embarked on the construction of a 508-housing unit at Zuba, a suburb of the Federal Capital Territory (FCT) at the cost of N6,260,033,044.89.

12th Abuja International Housing Show

In the year under review the Abuja International Housing Show, the largest housing and construction event in Nigeria held its 12th edition. The event which was well attended featured ministers from outside Nigeria, with major stakeholders in attendance. First women in housing initiative was held during the show, while not too young to own a home platform was inaugurated

17 killed in Abuja, Port Harcourt building collapse

A total of 17 people lost their lives to building collapse between August and December, 2018.In August,  two people lost their lives in collapsed building in Abuja, where more than 15 others were trapped.

The building located at Sector Centre B, was said to have been built in 1997 and later abandoned for more than 20 years before the owner decided to increase the number of floors of the already soaked building.

Also in September, a total of 15 people were killed at the site of the collapsed in Port Harcourt, Rivers state.Experts have attributed the ugly incidents to the poor handling of the projects.

Non-commissioning of NHP

Aside from the building collapse, the non-commissioning of the National Housing Project, NHP, which was reportedly slated for last year was one of the low events in the housing sector for the year 2018.

The President Muhammadu Buhari-led government’s effort at addressing the huge housing deficit in Nigeria, which is estimated at 17 million, gave birth to the National Housing Programme.

Under the programme, the federal government through the Federal Ministry of Power, Works and Housing, embarked on the construction of massive national housing scheme in 33 states of the federation.

The project, according to the Minister in charge of the ministry, Mr. Babatunde Raji Fashola, SAN, aside from providing affordable and accessible houses for Nigerians, has also created employment opportunities.

Countdown Begin For The Maiden Edition of Nigeria Skills Expo

More than 15,000, construction industry artisans are gearing up for the maiden edition of the Construction Artisans Awards 2019. The event will take place at the Old Parade Ground Abuja, from 28th – 30th January 2019.

It will feature 7 key trades, which will include; Welding, Painting, Tiling, Masonry, Carpentry, Plumbing and Electrical Installation, in addition to a Job Skills Expo, Artisans Summit and Artisans Awards.

“The Construction Artisans Awards is been put together to celebrate Artisans in the building and construction industry. It gives Artisans the opportunity to be recognized for the hard work, talent and vision they put forward in the construction industry’’, said Anthony Okwa, Project Director C-STEmp (Construction Skills Training and Empowerment project),organizers of the award.

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C-STEmp has the key objective of breaking the paradox of high unemployment and poverty in the midst of severe shortage of skilled manpower in the construction sector, development of industry driven curriculum and training model that can be replicated across the country to boost the supply of competent artisans and craftsmen in order to improve the standard of construction and productivity in the sector. Its medium term objective is to spawn a network of training providers that can complement it to build up a critical mass of up to one million trained, assessed and certified artisans who would be duly registered in a database to be maintained by the relevant sector skills council.

The Construction Artisans Awards (CAA) was conceived as part of a holistic strategy to generate excitement and interest in the construction trades. It will bring over 15,000 artisans and up to 5,000 spectators, visitors and stakeholders together as well as about 30 million viewers globally through broadcast on international and national television and the internet.

The skills competitions offers a unique opportunity for skilled Artisans and apprentices to showcase the knowledge, skills and experience they have acquired over the years in order for them to be celebrated by their employers, friends, families as well as communities.

The awards also offers construction companies, real estate developers, equipment and tools as well as materials manufacturers to showcase their products and demonstrate their commitment to quality craftsmanship by showcasing their products and services especially to the artisans who not only directly handle them, but very often determine their patronage.

Features of the Small Scale Building Materials Production Workshop are;

  • Paint Making – Emulsion paints, textured paints, Sandtex paints
  • 3D Wall Decoration And Embossment
  • Cracked Tile Production – various floor and wall tiles
  • Production of white glue or wood adhesive
  • Production of particle boards, partitioning boards and suspended ceiling
  • Making various types of sand paper
  • Production of interlocking tiles and pavement tiles
  • Production of polystyrene boards, parapet boards and decorative materials
  • Mould making and designs
  • 1 Demonstration of how to make stone coated roof tiles


The 7 categories of the awards are;

  • Best artisan in Masonry, concreting and plastering
  • Best artisan in carpentry and joinery
  • Best artisan in welding and steel fabrication
  • Best artisan in plumbing installation
  • Best artisan in electrical installation
  • Best artisan in tiling and decorative stone work
  • Best artisan in painting and decoration

The best artisan will receive One Million Naira, a complete tool kit Set, and automatic employment. While the best female artisan and best young artisan will go home with N500, 000 and N100, 000 respectively.

In addition to C-STEmp, (the award organizers) other partners and sponsors include; UK aid, British Council, The Construction Industry Training Board (CITB) Northern Ireland, Copen Group, J Hausen, FESADEB Media Group, Nigerian Institute of Builders (NIOB), Council of Registered Builders of Nigeria (CORBON), IL&FS, FMBN, National Board for Technical Education (NBTE), The Real Estate Developers Association (REDAN) and Abuja Property Development Company (APDC).

Affa Dickson Acho


Performance Survey: How The Construction Industry Fared in 2018

A quarterly survey of the performance of the construction industry in Africa from a panel of construction industry players in various countries in Africa, reveals how the construction industry fared in South Africa, Kenya and Nigeria.

Over the last decade, Africa has seen its ups and downs as economic fortunes wax and wane. To determine where Africa stood in 2018,a survey was carried out by (Construction Review) on over 700 participants drawn mainly from Kenya, South Africa and Nigeria in order to determine how they felt 2018 compared to 2017. Collating the information produced interesting conclusions.

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When comparing Kenya South Africa and Nigeria, Nigeria emerged as the most positive market with regards to improvement of the construction industry in 2018 over 2017. Overall 52% Nigerians polled, felt the construction industry was better or much better in the 3rd quarter compared to 42% for Kenyans while only a dismal 13% of South African respondents felt any reason to smile.

The report took a closer look at this cadre of respondents particularly those that felt there had been an unusual improvement by looking at those who felt the improvement was ‘much better’ not only ‘better’. It turns out that for Nigeria the reason was the fact that the country is emerging from a major slump after the fall of crude oil prices in the preceding years. For Kenya those seeing major improvement felt it was due to a more stable political environment in the wake of a nail gripping general election and its aftermath. For South Africa virtually no one fell into this space suggesting that the South Africans were a very dismal lot in 2018.

Respondents were asked to categorize themselves as government, consultants, contractors or suppliers in the industry. From this it emerged that those who were  satisfied, were virtually consultants and project managers in Nigeria with no contractor or building supplier sharing the same sentiments. In Kenya those feeling that the industry had enjoyed a much better improvement than in 2017, were equally consultants, builders and suppliers of products and machinery. This could mean that in Nigeria the projects are on the drawing board and have not filtered down to actual project commencement while for Kenya this could mean these are ongoing projects.

In Nigeria 85% of respondents say the improved performance was driven by housing, while for Kenya,it stood at 52%. This means that housing was a key driver of the improved construction activity but more so in Nigeria than in Kenya.

Respondents felt that the primary reasons for this state of affairs is lack of government and private spending in the sectors coupled by cut throat competition for the few jobs available which has meant projects were virtually not profitable. The upcoming elections in Nigeria has also introduced uncertainty.

Smart building materials to watch in 2019

While housebuilders gaze into the future, researchers have been turning to the past for inspiration. Over the last few years, the DNA of concrete has been decoded and rewritten by scientists to make the material that built the Roman Empire fit for the future.

Hendrik Jonkers of Delft Technical University in the Netherlands first developed self-healing concrete, then Basilisk Concrete commercialised it. Since then, it has been pouring closer and closer to the mainstream. The magic solution uses a bacteria that produces limescale when it comes into contact with oxygen or water, filling the crack and essentially healing the wound.

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However, the real excitement will begin when concrete can continually monitor, regulate, adapt and repair itself without any help. Smart materials promising to make this a reality include nanomaterials, multi-functional materials and biomimetic materials, which will essentially transform concrete into a living skin for the built environment.

At Rice University in Texas, researchers are working on programmable concrete, a modified version which is greener, more durable and flexible.

“We call it programmable cement,” Rouzbeh Shahsavari, an assistant professor of materials science and nanoengineering at Rice University, said. “It’s the first step in controlling the kinetics of cement to get desired shapes. It’s a hot area, and researchers are taking advantage of it. But when it comes to cement and concrete, it is extremely difficult to control their bottom-up assembly. Our work provides the first recipe for such advanced synthesis.”


Another ancient building material that is coming back in vogue is straw. Researchers at the University of Bath have proved straw to be a durable, affordable and environmentally-friendly building material. The scientific research has paved the way for homebuyers to get insurance and mortgages for straw homes, meaning these eco houses are likely to be the cream of the crop in future.

Straw walls provide two times more insulation than required by current UK building regulations, and can reduce fuel bills by up to 90%.

The walls are built using ModCell technology; prefabricated panels consisting of a wooden structural frame infilled with straw bales or hemp and rendered with either a breathable lime-based system or ventilated timber or brick cladding.

This technology combines the lowest carbon footprint and the best operational CO² performance of any system of construction currently available. In fact, as an agricultural co-product, straw buildings can be carbon negative as straw absorbs CO² when it grows.

Professor Pete Walker, Head of the Department of Architecture and Civil Engineering at Bath University, said, “As a construction material, straw is a low-cost and widely available food co-product that offers real potential for ultra-low carbon housing throughout the UK. Building with straw could be a critical point in our trajectory towards a low-carbon future.”


Glass is also being reengineered to be much tougher than it looks. HUF HAUS recently launched the HUF Connector, which allows glass to be woven into the structure of a building.

“The result of over five years of research, this unprecedented innovation is set to revolutionise the way glass is used; it is now possible to connect glass to timber, without the need for a buffer, so that the glass forms an integral component of a structure – and functions beyond the aesthetic,” said Peter Huf, Lead Architect for HUF HAUS in the UK.

“For the first time ever, we’re able to use to use glass in the same structural way as our traditional walls, affording an unprecedented design freedom,” he added. “Because of this technology, all internal and external walls can be made of glass.”


In a reversal of traditional roles, it could soon be common for windows and solar panels to be made from wood. Researchers at Stockholm’s KTH Royal Institute of Technology developed a new transparent wood material that’s suitable for mass production.

Lars Berglund, a professor at Wallenberg Wood Science Center at Stockholm’s KTH Royal Institute of Technology, said, “Transparent wood is a good material for solar cells, since it’s a low-cost, readily available and renewable resource. This becomes particularly important in covering large surfaces with solar cells.”

The optically transparent wood is a type of wood veneer in which the lignin, a component of the cell walls, is removed chemically. “When the lignin is removed, the wood becomes beautifully white. But because wood is not naturally transparent, we achieve that effect with some nanoscale tailoring,” said Berglund.

Among the work to be done next is enhancing the transparency of the material and scaling up the manufacturing process. “We also intend to work further with different types of wood,” Bergland.

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