Moshood Isah

Minister of Power, Works and Housing, Mr. Babatunde Fashola, recently revealed that there would be change in the policy direction of the Buhari’s administration in the settlement sector. He said the 2016 budget would make provision for the Federal Government to spend N10 billion on low income housing estate in each of the state of the federation and the Federal Capital Territory.
This is coming on the heels of the various complaints by citizens and professionals on the problems of accommodation in the country. The most recent coming from the Nigerian Institution of Estate Surveyors and Valuers (NIESV) which expressed displeasure at the low rate of housing development in the country, urging government to make deliberate efforts to house Nigerians because of its socio-economic advantages. Members of the various faculties of the institution discussed areas of the built environment that they would want the government to intervene in.
The first vice president of NIEVS, Dr. Bolarinde Patunola Ajayi, who is the coordinator of the institution’s Board of Faculty, urged government to involve members of the institution in housing and valuation issues. He advised Fashola to involve all relevant stakeholders in the built environment to enable him succeed faster in the performance of his duties.
The problem of inadequate housing for the teeming population of approximately 180 million is getting even more complicated. As at 1991, Nigeria was said to have a housing deficit of 7 million units. Twenty-four years down the line, the deficit has skyrocketed by about 250 percent according to statistics. The housing deficit at the moment is put at 17 million units. The World Bank has also estimated the cost of bridging Nigeria’s 17 million housing deficit at N59.5 trillion. This is not too far from the estimation of the Federal Mortgage Bank of Nigeria which had put it at about N56 trillion to be able to adequately meet the housing needs of Nigerians.
In a similar vein, Mr. Gimba Kumo, former Managing Director, Federal Mortgage Bank of Nigeria (FMBN) during his tenure also admitted that between 17 and 20 million housing units were needed to address the housing deficit in the country. Kumo also explained that many other Nigerians deserve much more than what they get as shelter thus he emphasized the need for the provision of mortgages, and construction finance for the houses to be built.
Managing Director of the Federal Housing Authority (FHA) Prof. Mohammed Al-Amin also agreed that there were a 17 million deficits in Nigerian housing, a situation that makes his coming at this time, critical. He explained that the deficit was not just a factor of production but also that of demand. The professor further explained that there was a huge difference in the country’s population in the last 40 years compared to what it is now. He explained that when there is a high population, especially one growing at about 3.7 percent per annum, then definitely whichever system of housing finance is in place, if not properly positioned, will always result in deficit.
An in-depth investigation shows that the exact deficit figure of 17 million has being bandied has lingered for over a decade. President Olusegun Obasanjo completed his two presidential terms in 2007 and even during his first term lasting between 1999 and 2003, the deficit figures were put at 17 million. It has begun to generate reactions as to the reliability of statistics. Economic Confidential was not able to discover the origin of the particular figure as it neither originated from the Federal Housing Authority (FHA) nor was it the outcome of any critical research. Some stakeholders insist the deficit in housing requirement has been growing at 5.8 percent per annum, which has given rise to a slum population estimated at about 70 percent. This has also made estate developers, valuers and other housing experts to believe that the Nigerian housing deficit is much more than 17 million. In this vein, there are doubts on the statistics of housing facilities built by the federal government.
This is corroborated by the fact that the government have only built about 40,000 housing units in the last 40 years. While official statistics seem to be unavailable, information from the FHA suggests government is always directly or indirectly involved in most housing projects in this country. The Managing Director of the housing authority argued that the government has built much more housing units because apart from the direct construction done by the Authority, other housing units have been put up through its various partnerships with the private sector, including the facilitations of most of the various state governments’ housing projects. Al-Amin was quoted saying, “People are not talking of the partnerships, the facilitations that we do, either in giving money to off-takers to process housing or injecting our technical know-how in sites, serving as a go-between for prospective house owners and financiers to make sure finances come down.
Although there are thousands of unoccupied houses in mega cities like Abuja, Lagos and Port Harcourt, some built professionals argue that these were constructed by private individuals at exorbitant prices due to lack of support from the government. Thus the prices of housing in such cases are usually expensive and apparently beyond the reach of less than affluent citizens. According to an estate developer, Mr. Adekola Adetomiwa, the unoccupied houses are not for the masses rather they are for very rich people. A house that goes for anything above N2million is not for the masses, Adetomiwa declared adding that the problem is that those erecting these unoccupied houses are not thinking of the masses but are rather thinking of the rich.
He described such tendency as misplaced priorities. “If those houses built in Asokoro can be built in local areas like Kuje, at least more than 100 people will occupy them and it will solve some part of the housing deficit problem. Most of the houses unoccupied are built by rich men as collateral to secure bank loans” he explained.
Adekola who is the Managing Director of Royalting Fund Abuja, further revealed that recent administrations in the country hardly embark on housing construction because the environment has not been conducive for anybody working to get what you need to build a genuine housing unit. The problem is lack of vision and plan as even the Federal Mortgage Bank of Nigeria does not get any useful allocation to build housing units. As a matter of fact, Economic Confidential can reveal that, the 40 percent of commercial banks profit which is supposed to be allocated for housing construction is not being channeled to the right place. According to Fashola, “we must change the budget for national housing from N1.8 billion in 2015 to something in the hundreds of billions of naira that matches our ambition. “If we can spend N10 billion in each state and the FCT on housing alone every year subject to (a) the capacity to raise the money and (b) the capacity to utilize the funds having regards to our current construction methods and the time it takes to complete construction, which our ministry intends to change by research and industrialization of housing,” he said.
Continuing he said “although the Jonathan government created a secondary market where a mortgage bank can sell non performing mortgage instruments, there was no primary source where a mortgage bank will source the initial capital to finance the construction. This is due to the fact that the right people are not in the right place. There are neither policies nor standards guiding housing in Nigeria. If at all there are policies, they are not being followed. While unveiling the Buhari’s administration agenda in the housing sector, Fashola said there is need for the government to review the existing policy in the housing sector to address deficit.
Also speaking with our correspondent, chartered member of NIESV, Mrs. Toyin Ilori complained that lack of funds is the major problem behind inadequate housing as many buildings are left uncompleted. Mrs. Ilorin joined her voice with that of some other experts in identifying the Land Use Act of 1978, which confers ownership of land in state governors, and a cumbersome property registration process as major barriers to housing development and home-ownership and had led to the country’s huge housing deficit. The former managing director of the FHA, Fortune Ebie, also agreed that until the Act is reviewed or amended, improved housing development will continue to be a pipe-dream.
Again, Ilori who is chief executive officer at Toyin Ilori Consult identified exorbitant fees paid to register property in Nigeria a barrier that must be removed to effectively tackle the huge housing deficit. According to her “about 16 procedures are required to register property in Nigeria and each process comes with its own physical and financial rigors, while countries like Norway and Singapore require just a single procedure”.
The difficult procedure in registering properties alongside other barriers like unstable macroeconomic environment, lack of capacity and infrastructures are other issues hindering housing progress in Nigeria. While estate valuers and surveyors continue to lament low patronage due to lack of risk sharing mechanism, delay in license, high taxing and high cost of building materials are other problems leading to the escalation of housing deficits in Nigeria.