Faced with a housing deficit of more than 20 million units, the United Nations (UN) rapporteur has called on the Federal Government to tackle the accommodation crisis in Nigeria.
“Nigeria’s housing sector is in a complete crisis,” Leilana Farha, the UN special rapporteur on adequate housing, said Tuesday, adding that “Existing programmes will hardly make even a small dent in addressing the ever-growing housing need.”
Lack of adequate and affordable housing has left inhabitants in Africa’s most populous nation with the option to fund housing projects with personal servings in a country now described as the poverty capital of the world, with many living on less than $2 a day.
According to the Association of Housing Corporation of Nigeria (AHCN), an umbrella organisation for all federal and state housing agencies, more than 90 percent of new homes utilise funds from personal savings for incremental construction.
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“My 10 days fact-findings visit to Nigeria has presented an economic inequality in the country, which has reached an extreme level and is playing itself out clearly in the housing sector,” Farha said in Abuja.
The high mortgage rate remains one of the key culprits in Nigeria’s housing challenge. A typical mortgage in Nigeria ranges between 7-10 percent for Federal Mortgage Bank of Nigeria (FMBN) and between 15-25 percent for commercial mortgage institutions, one of the highest in the world.
This has left the industry less attractive for many who find it difficult to feed three times a day, despite living in a country that is acclaimed to have the largest economy on the continent.
Nigeria has one of the world’s lowest mortgages to Gross Domestic Product (GDP) rate at 0.6 percent. This lags Ghana’s 2 percent, South Africa’s 30 percent and crawls after the U.S and UK rates of 60 percent and 70 percent respectively.
Speaking at a news conference in Nigeria, Farha expressed concerns over the poor living conditions of Nigerians, saying informal settlements house about 69 percent of the urban population.
“Most residents in Nigeria’s ballooning informal settlements live without access to even the most basic services, like running water.” According to her, they “lack security of tenure, forcing them to live in constant fear of being evicted.”
According to the rapporteur, this is happening at the same time when newly built luxury dwellings are springing up throughout cities and made possible often through the forced eviction of poor communities.
“These units do not fulfil any housing need, with many remaining vacant as vehicles for money laundering or investment. So, in many jurisdictions; they have started to impose a vacant home tax.”
In the case of Nigeria, she added that “it could be used as a fund to upgrade informal settlements.”
