Major challenges inhibiting the production of mass and affordable housing in the country were, again, brought to the fore during the 7th edition of the National Housing Fair in Lagos at the weekend. Stakeholders at the forum suggested some solutions in order to enhance home ownership among low and middle income Nigerians. DAYO AYEYEMI reports.
Ooni of Ife, Oba Enitan Adeyeye Ogunwusi; former President of the Nigerian Bar Association, Mr Olisa Agbakoba; former Deputy Governor in Lagos State, Mr Femi Pedro and the host of others, have called on the government to improve the economy in order to enhance home ownership among 80 per cent of Nigerians in dire need of their own house.
They also canvassed for social housing, improved mortgage system and availability of long-term funds.
Speaking during the occasion of the 7th edition of the National Housing Fair, first Lagos’ Edition organised by Dr Becky Olubukola – led BSTAN Group of Companies, Ooni Ogunwusi, Agbakoba and Pedro, spoke to some of the issues limiting home ownership and affordable housing production in Nigeria. They also suggested some solutions.
A lot of dignitaries comprising traditional rulers, community leaders, developers, building materials manufacturers, officials of government, policy makers, actors and actresses were present at the forum.
Dead assets
Themed: “Property In A Sachet: Gateway To A Better Life,” Oba Ogunwusi, in his keynote address, said the country has a lot of dead assets.
According to him, any economy with dead assets is creating big problem for the young and upcoming individuals as they would have difficulty in assessing mortgage.
Unlike the western world where all property are duly registered with titles he said it has become difficult in Nigeria for people to leverage on their property.
“In Nigeria, we have not got to the level of securitization, a lot of assets are just there, you cannot even see how to leverage on these assets, and you cannot purchase title within few days. Everything is very difficult in this country. At the end of the day, the young and upcoming individuals are suffering. A lot of people will say I don’t want to take money from the bank but, in the western world, what they do is leveraging,” he said.
In the developed countries, Oba Ogunwusi explained that so many properties have been entrusted in mutual funds, adding that they formed the assets for useful money in the economy.
“But in Nigeria, we make money and build and keep the papers somewhere. You are only thinking about yourself, you are not even thinking about your gatemen, security man who works for you and your maids that, someday they will have access to mortgages so that they can have a access to their own home. We have a very much misplaced priorities in this country,” he said.
While commending the President/Group Managing Director of BSTAN Group, Her Royal Majesty, Dr BeckeyOlubukola, Ooni said he was impressed by what the group is trying to do in Lagos.
He said the company is targeting affordable housing for the young and upcoming adults, which payment could be spread over a long period of time.
He noted that a lot of people have been having difficulty about where to stay, describing Lagos as a very huge market.
He added that the country has over 20 million housing deficit, pointing out that over the last 20 years, Lekki corridor alone has got investment’s flow of more than $30 to $40 billion.
Social housing
Agbakoba urged the government to create a pot of social housing for the populace, saying such is needed to meet the housing needs of 25 million Nigerians in dire need of accommodation.
He also tasked the government on the need to tackle the problems associated with absence of long-term financing in the economy.
According to him, government should also encourage the rich and the private investors to get into the provision of social housing.
According to him, government should make social housing a priority.
Agbakoba also wants the government to tackle the problems associated with titling and mortgages in the country, saying the issues could be worked out by looking at some of the contraints.
“If we get it right, it’s good for all of us,” he said.
Rather than concentrating development on high-brow Ikoyi for housing development, the former NBA president tasked developers to look at another model to be involved in property.
Former Lagos State Deputy Governor, Mr Femi Pedro, corroborated earlier speakers, saying there was nothing wrong to invest in real estate, describing investment in the sector as “lucrative, profitable, symbol of prosperity, wealth creator.”
He, however, cautioned that real estate is also a problematic sector.
He identified lack of long-term funds as the bane of real estate in the country.
According to him, less than 20 per cent of Nigerians owned their own home, while more than 80 per cent of the people could not due to lack of money.
“When there is no long-term funding, there cannot be a thriving real estate industry,” he said.
With the current state of the economy, Pedro noted that only insignificant of the Nigerian population could afford to buy home
According to him, majority of the people could not afford to buy a home due to absence of long-term funds.
“Even the cheapest house at N20 million, if you start an esusu today till 20 years, you cannot put N20 million together in your lifetime,” he said
Pedro pointed out that the absence of long-term funds was a manifestation of a struggling economy.
He said “We are a country that is struggling economically, and where struggle manifests itself in the area of funding, inflation rate is the beginning of the problem.
“When you have a country with high rate of inflation, what that means is that investors – those who have money to invest will not bring their money to that economy, because they are telling themselves that if I bring N1000 today and there is 20 per cent rate of inflation, in one year my N1000 naira would have been reduced by 20 per cent to N800.
“So investors look for where the inflation rate is low. And when there is shortage of capital, investors are not bringing money; bankers don’t have long-term money to lend out. That is why bankers focus on short-term lending.”
“It is easy for developers to buy land at N5 million 10 years ago and now selling it for N50 million. If you build houses that are selling for 30 million, who are the people going to buy these houses? The people who are buying the houses now are mostly those who have made money from abroad or are fortunate enough to have jobs that give them enough capital at a go to be able to buy these properties.
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“This has left out millions of people who are asking how to own a home. So anytime inflation rate is high, there is a shortage of fund, and when there is a shortage of capital, the interest rate goes up. Interest rate is the price of money. When supply of money is low and demand is high, the price goes up,” the former deputy governor said.
To solve the problem, Pedro, a former CEO of a bank, called on the government to fix the economy.
“It is only when the economy is stimulated, when there are activities, people are working, they are buying, they are selling, they are building and earning good income, that is when money flows into that economy.
“When money flows in, then banks have the money to give out as mortgages. The shortest period to get a mortgage loan is 20 years, anything less than 20 to 30 years tenor at 6 to 7 interest rate will not work,” Pedro said.
Another stakeholder, Olu Okeowo, said the time to buy real estate is now, reeling out the economic benefits of investing in the sector.
He urged all participants not to wait for real estate to mature before they invest but to buy real estate and wait.
“Don’t wait to buy real estate, buy real estate and wait,” he said.
Other stakeholders urged government to rise to the challenge and develop descent and affordable home for the people.
“We must create vibrant housing market that will improve our wellbeing and economy of our nation,” they said.
They called for support for the National Housing Fair for “creating an enabling environment for all to discuss issue that will provide affordable shelter for our people.”
Property in a sachet
Speaking about the idea behind bringing National House fair to Lagos, President/Group Managing Director, BSTAN group, Dr Becky Olubukola, said it was geared towards curbing accommodation deficit and promoting housing development in the public and private sectors.
Explaining the importance of “Property in a Sachet (PIS)”, she described the initiative as a pocket friendly initiative for housing development/ ownership.
“PIS was birthed after a 5-year extensive research into standard of living, income statistics, mortgage and investment schemes,” she said.
According to her, PIS is accessible to everyone without additional interest rates, adding that anyone could be a part of the initiative.
She explained further that the initiative was practically developed to curb housing deficit in Nigeria, reduce the rural to urban migration, increase the home ownership rate in Nigeria by 70 per cent in the next three to five years, improve the standard of living and put a hold on the current japa syndrome.
According to Olubukola, PIS initiative is set to make Lagos its pioneering state, adding that in due time, the initiative would be extended to different states across Nigeria including Port-Harcourt, Bayelsa, Akwa-ibom and Ekiti, among others.
“The PIS initiative in partnership with the Lagos State Property Development Corporation (LSPDC) & other institutions
“It will have projects in the following locations such as Ibeju-lekki, Epe, Ikorodu and Badagry, the group managing director of Bstan said.
According to her, PIS centreswould be installed in all the 20 local government areas and across the 37 local council development areas across Lagos state.
“In a bid to cut down the traffic congestion in Lagos state, the PIS initiative would be introducing the Bstan PIS Quick Ferry, an intracity water transportation system. This is for the sole purpose of conveying Lagosians to their places of work and respective destinations without delay and bypassing the traffic congestion in Lagos,” she said.
She explained that Bstan Homes Metro Shelter is a scheme designed to achieve mass urbanisation and reduction of homelessness across Nigeria.
Under this initiative, she said the company would be developing 30,000 units in the form of gated estates across eight locations compising; Abuja, Lagos, Ibadan, Osogbo, Abeokuta, Port Harcourt, Imo and Asaba.
According to her, Metro Shelter would catalyse the achievement of urbanisation, proper town planning and eradication of slum shelters.
“With equity contributions in land per location, we propose a mass housing development of 3,750 units in each location to be executed in 3 phases. Each phase will deliver a minimum of 10,000 units across the various locations with each location delivering at least 1,250 units annually,”she said.
House types to be developed, she said would vary according to what is obtainable within the location and as detailed in the presentation layout for each of the estates within each of the locations.
“Each phase will take a period of 12 months/1year. The house types to be built include: units of 1-bedroom flat, 2-bedroom flat; 3-bedroom flat; 2-bedroom semi-detached bungalow and 3-bedroom bungalow,”she said.