• Friday, December 01, 2023
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The challenges of affordable housing in Nigeria (II)

Improving access to affordable housing

With the National Development Plan (NDP) blueprint in force, the government hopes to improve the supply of low-cost housing units from 500,000 to 1 million homes per annum.

Also, it is expected that the relative contribution of the housing and real estate sectors of the economy to national output will increase from the current 5.7 percent to 8.38 percent, while the urbanisation rate is expected to decline from 52 percent to 40 percent.

Sufficient investment by the government in the country’s housing infrastructure is expected to help regain macroeconomic stability by improving the nation’s business climate, attracting more foreign and local investors, pulling in more foreign capital, and promoting better social outcomes domestically.

High population expansion is another factor that increasingly limits housing affordability in Nigeria. The country’s overpopulated inhabitants limit the current resources’ absorptive capacity to cater to the teeming masses.

There are too many individuals per resource to share, making it difficult for many to enjoy the benefits of the nation’s vast but outnumbered resources. While Nigeria’s resource potential is highly underutilised and mostly untapped, the increasing population rate continues to overburden existing capacity, often leading to disproportionate access.

The United Nations has estimated that Nigeria’s population will reach about 400 million by 2050, making the country’s population growth rate about 2.8 percent annually. The increasing population rate will continue to undercut per capita access with limited resources exploration and expansion, and available allocations will be pricey.

For this reason, governing over about 200 million Nigerians has become practically challenging, especially when a sufficient database is non-existent.

High crime rates, insufficient public service delivery and access and weak social indicators have become a direct offshoot of a highly populated and poorly governed citizenry who are highly unaccounted for.

Read also: The challenges of affordable housing in Nigeria (I)

Many homeless citizens abound in the country, but an active social system is absent to cater for this vast number. In order to develop a full plan for this category of individuals, there must be an active database to capture the homeless population who sleep under bridges, public spaces, motor garages, religious centres, bushes, and unoccupied homes.

The government needs to embark on a structured population data-gathering exercise to calibrate the country’s actual housing deficit properly. This will help the authorities to have a better idea of the number of needed shelter space interventions per capita.

If this can be done, a more appropriate housing plan can emerge, which will effectively take care of existing versus expected stock of housing units vis-à-vis the size of the average unhoused Nigerian household.

Following the incidence of overpopulation is the high urbanisation rate in Nigeria. Over the past two decades, Nigeria’s annual urbanisation rate has been 3.5 per cent, making growing cities double as slum capitals in recent times.

Increasing rural-urban migration has led to accelerated urban population growth as people exit rural areas searching for a better life and opportunities in urban centres. Most times, these rural migrants are left disappointed when they encounter the harshness that urban life presents.

Although the federal government’s NDP on housing infrastructure hopes to help decrease rural-urban migration to 5.0 per cent from the current 6.5 per cent, together with a targeted reduction of urban residents who live in slums and shanty towns to 55.2 per cent from 69 per cent, it is unclear how this new plan will suffice.

With the current state of increasing deterioration of cities around the country, the government’s programmes on city clean-ups may not achieve its aims.

Overconcentration of people as well as economic, social and other environmental activities in urban spaces puts undue pressure on housing, infrastructure, public services, food availability and supply, health and education, employment, security and natural resources within the occupied areas.

If unchecked, increasing the urban population above the capacity of its resources will lead to a rapid deterioration of housing and living conditions. Hence, it is not surprising that urban households usually find it difficult to afford basic formal housing or access mortgage plans since the cost of living in these areas is typically high. Rental fees are especially very expensive.

Many households would rather settle for sub-urban areas within the metropolis to escape the unbearable living costs associated with the typical urban lifestyle.

For instance, in Abuja, the federal capital territory, there are reports of several unoccupied houses in the core urban areas. However, many still opt for the shanty towns nearby because of the unreasonable rental cost.

The Abuja Housing Forum in 2019 revealed over 17 million housing deficits in the country, and the required financial need to close this gap is about N60 trillion. In a related report, the Federal Mortgage Bank of Nigeria also revealed that the country suffers up to a 22 million housing deficit.

To provide realistic intervention to the housing challenges that face the country, the federal government must prioritise policies that address the nation’s unique macro fundamentals.

Policies are required to reduce the cost of housing materials, construction, and rent and provide easy mortgage loans to households at concessionary rates. Furthermore, sovereign efforts to pacify and engage concerned private sector players are necessary to ease the country’s supply channel of affordable housing.

Land acquisition and use policies that are people-oriented should be enacted, and appropriate fiscal and monetary interventions that could ease production and supply activities of manufacturers, builders and other merchants in the real estate industry should be put into consideration.

Also, the government should make appropriate investments in rural areas to expand urban-type opportunities for people living in those areas. This should discourage massive rural-urban migration and help decongest the overpopulated urban centres.