• Monday, June 24, 2024
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Why govt policies, programs don’t translate to growth in housing sector

HEREL expands operations, adds real estate devt to existing portfolio

For reasons other than lack of basic infrastructure, high cost of funds, regulatory hiccups, etc, government policies and programs in Nigeria have failed to translate to the growth of the housing sector, leaving the country with an ever-widening housing demand-supply gap.

Another major issue with housing sector growth in Nigeria is rural housing. Some experts are of the view that the housing deficit in Nigeria is an urban problem. Babatunde Fashola, Nigeria’s minister of works and housing, holds this view strong. Fashola believes that there is no housing deficit in this part of the country, explaining that many houses are lying empty in many towns and villages in the country.

But Ayo Iluyomade, chairman, Aimart Realtors International, says the issues with rural housing in Nigeria are not only that rural development is poor, but also because rural housing is of low quality and this spreads across locations, quality levels, and value of the property.

He adds that rural housing suffers deficiencies in areas of social services like electricity, water supply, and transport facilities, leading to what Roland Igbinoba, CEO, Pison Housing Company, calls qualitative housing deficit.

Read also: Housing deficit in Nigeria is an urban problem, says Minister

The high rate of urbanization and the ever-increasing population of urban dwellers are also part of the reasons Nigeria’s housing sector remains in negative growth territory. Lagos, Nigeria’s commercial capital, for instance, is said to have an estimated 20 million people with a growth rate put at 3.2 percent per annum.

Iluyomade links the slow growth in the housing sector to these reasons, noting, “housing in Nigeria has not ranked high on the scale of priorities for social spending and this has been clearly reflected in the minimal efforts put into providing low-cost housing both in rural and urban areas.”

He noted further that the creation of the Federal Mortgage Bank of Nigeria (FMBN) in 1977 did not make much impact because, according to him, there have also been such limiting factors as lack of effective planning, uncontrolled private sector participation, weak institutional frameworks, poor research and development in the housing sector, sometimes, inflation, income policy, and socio-economic trends.

The realtor recalled that since 1991 when one of the country’s latest housing policies was launched, there have been policies and programs aimed at delivering mass housing as a path to Nigeria’s economic recovery.

“NHF was established in 1992 to nurture and maintain stable affordable housing financing overseen by the FMBN. The current administration has launched the Economic Recovery and Growth Plan (ERGP) to stimulate the economy through agriculture, housing construction, food security, renewable energy, infrastructure, manufacturing, and the digital economy to create jobs,” he said

He added that the establishment of the Economic Sustainability Committee (ESC) led by the Vice President in response to the COVID-19 effect was aimed to deliver a massive housing programme with a timeline of 12 months and an estimated cost of ₦317,292,377,973.48 with the expectation that the strategy would create 1.8 million jobs.

“The Federal Ministry of Works and Housing, FMBN, and the Federal Housing Authority (FHA) are the governing bodies to co-ordinate the delivery of this strategy,” he informed.