In a move the housing sector’s stakeholders describe as encouraging, the Federal Government is perfecting plans to raise N800 million from the African Development Bank, the World Bank and other institutions to provide affordable mass housing accommodation for Nigerians.
The move, if followed through and implemented, will mark a major paradigm shift in the whole business of building and buying homes. Going by government’s intentions, the fund goes beyond providing housing for low-income Nigerians.
The fund is part of the Family Homes Funds (FHF) initiative and, according to Femi Adewole, its chief executive, FHF is disbursed in two ways. “We are providing finances for developers who will build homes ranging from N2.5 million to N5 million. In addition to that, we are providing some assistance to the buyers of those houses. We are giving them deferred loans up to 40 percent of the cost of the houses,” he explained.
FHF is a housing investment fund owned by the Sovereign Wealth Fund and the Ministry of Finance Incorporating. It was set up primarily to finance housing for Nigerians who are on low income, meaning that it is for Nigerians who are earning below N100, 000 per month as a household.
It targets 500,000 homes, which is why its managers are talking to a lot of development partners. This requires a lot of money, which, Adewole said, was not going to come from the federal government alone.
“So, we are developing partnership with a whole range of development institutions, and the African Development Bank (AfDB) and the World Bank are just two of the institutions that we are talking to and who are providing support for us”, he revealed.
FHF is a relatively young company, having existed for just 45 months. It has commitment of over N200 million on the N800 million target. But, besides that, the fund has invested over N20 billion into five housing projects, which are ongoing some of which are located in Kaduna, Kano, Lagos and Delta states.
It is expected that at N2.5 million and N5 million for the housing units being developed, many more Nigerians will have access to homes. The 500,000 homes target may be surpassed and the country’s housing deficit burden might be lighter.
Adewole assured Nigerians that before the end of December, over 200 houses would have been completed.
Ugochukukwu Chime, president of Real Estate Development Association of Nigeria (REDAN), emphasised the readiness of the body to work in collaboration with stakeholders in the housing sector to move the sector to a higher level.
“It is our sincere responsibility to work with stakeholders in the housing sector to ensure that we move away from the learning curve to a higher pedestal of project feasibility, execution and closure. Knowledge is light and learning/training is key to understanding the dynamics of the business of real estate; it is also an instrument to wipe out ignorance,” Chime said.
REDAN is building its own secretariat complex and, according to Chime, the project will cost N500 million and expected to be “partially completed and occupied in one year and fully completed, equipped and furnished in two years.”
He appealed to the Federal Government, through the instrumentality of the FHF, to simplify the requirements and participation for willing Nigerians.
“Concentration on demand-induced supply based on market forces has not yielded the desired dividends because the value chain and transaction dynamics that will produce such effective linkage is non-existent,” he noted
