• Saturday, May 18, 2024
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Property law, land titling seen unlocking potential in $6trn housing assets

property law that guarantees unfettered access and ownership of land or houses, along with an efficient and effective land titling system are key instruments needed to unlock the potential in Nigeria’s housing assets inventory with an estimated value  of $6 trillion, experts say.

The experts explain that as seen in developed economies, property laws allow owners of housing to represent their value in law systems that allows easy access to credit, which in turn generates capital for economic development.

In Nigeria, most of the residential houses are dead assets and Yemi Madamidola, a real estate consultant and investment analyst, estimates that of the 10.7 million housing units in the country,10 percent of which are self-built, only about five percent are in formal mortgage.

Madamidilo explained in an interview with BusinessDay on the sideline of a Retailers Forum in Lagos, that effectively about 95 percent of home equity/savings in residential developments are ‘dead assets’, pointing out that the mortgage finance requirement for the country stands at between N15 trillion and N20 trillion.

He pointed out that as a result of this, homeownership in the country is still very low, adding that as against 72 percent homeownership in the US; 78 percent in the UK; 60 percent in China; 54 percent in Korea and 92 percent in Singapore, Nigeria has only 10 percent homeownership.


Madamidola canvassed a strong property law and an effective land titling mechanism that would guarantee improved homeownership levels and the attendant economic development.

Olisa Agbakoba, a Senior Advocate of Nigeria (SAN) and Principal Partner, Olisa Agbakoba & Associates, agrees, quoting De Soto, a philosopher and legal icon, as saying that law is a key primer of development, using property law as an illustration.

Agbakoba pointed out that property consisted of two values—physical and conceptual, explaining that   the physical value might be fixed in a house while the abstract or conceptual value was fixed in property law systems.

He observed that in Nigeria with a very weak legal regime, conceptual representation of property to create value was missing, arguing that “if the value of property is indexed to the banking system by massive legal reform of the property system, we can create an instant credit market in excess of our gross national domestic product, multiplied by a thousand times, thus making money available to finance development”.

He further said that lack of an effective legal framework was a major constraint to economic development, advising that policy makers must “consider that although macro policies are unquestionably important, there is a growing consensus that the quality of business regulation and the legal institutions that enforce it are a major determinant of development”.

Agbakoba noted that a thriving market economy with an active role for the private sector was all that it took for economies to develop, stressing that for Nigeria, “this is certainly the time to rethink our economic policy and include development law”.