The World Bank estimates that N59.5 trillion is required to address Nigeria’s 17 million housing deficit. The Federal Mortgage Bank of Nigeria (FMBN), however put the figure at about N56 trillion.
The managing director of FMBN Mr Gimba Ya’u Kumo, said the figure was based on a conservative estimate of constructing a housing unit at the cost of N3.5million.
He said that the huge capital outlay, made it mandatory for a concerted approach in government’s mass housing delivery programme.
Kumo who spoke recently at a workshop organised for trade union leaders, said the FMBN would create enabling environment to enable people assess mortgage loans.
He stressed the need for people, especially workers to register with the National Housing Fund (NHF), as it “guarantees accessibility to a large pool of funds,’’ for housing projects.
According to Kumo, the NHF scheme is for “Nigerians in all sectors of the economy, particularly those within the low and medium income levels who cannot afford commercial housing loans.’’
Some of the requirements for intending beneficiary is that he or she must be a registered contributor and up to date with his or her contributions.
To be eligible to borrow, contributors must have contributed 2.5 per cent of monthly basic salary or income for a minimum of six months.
However, some contributors to the NHF said they had been unable to assess funds from the NHF because of some difficult conditions.
Mr Agim Ogar, a Grade Level 12 officer in a government agency, said the equity contribution was too high.
“The equity contribution or personal stake of 30 per cent, 20 per cent, or 10 per cent depending on the loan amount applied for is too much.
“This makes it difficult for civil servants who earn less than the required equity contribution to access the loans as it would require borrowing to meet the requirements,’’ he noted.
Former president, Nigeria Institute of Builders, Mr. Chucks Omaife, advised relevant agencies of government to evolve better planning to meet the housing needs of Nigerians.
He blamed the inability of Nigerians, especially civil servants, to build their own houses on poor government policies.
To redress the housing deficit, the Mortgage Banking Association of Nigeria (MBAN), had suggested an increase in the level of housing finance in the country.
President of MBAN, Mr Femi Johnson, said it should be moved upwards from the present 0.5% to10% of the gross domestic product (GDP).
On its parts, the federal government said it would access $300 million soft loan from the World Bank for housing finance projects.
The minister of state for finance, Alhaji Yerima Ngama, who spoke recently after the federal executive council meeting, said the soft loan was designed to boost government’s housing delivery programmes.
“The council has deliberated and approved that we access 300 million dollars from the International Development Association, which is a soft borrowing window for developing countries, offered by the World Bank.
“This loan is going to be used in order to meet the government’s objective in the proposed Nigeria Housing Finance Project.
“The Nigeria Housing Finance Project, is aimed at increasing access to housing finance by deepening primary as well as secondary mortgage markets in Nigeria,’’ the minister said.
According to Ngama, $250 million of the amount will be used to establish a mortgage re-finance company.
He said that $10 million would also be devoted to capacity building and technical assistance to stakeholders in the mortgage industry.
The minister said that the establishment of mortgage guarantee product, targeted at the low income borrowers, would gulp $25 million.
“This guarantee will enable people who otherwise cannot provide adequate collateral to access loans,’’ the minister added.
According to him, the housing demand in Nigeria is currently put at 700,000 units annually, while only 100,000 units are being built for now.
Stakeholders in the real estate sector want the government to provide the necessary incentives to attract genuine investors to the sector.
They also want the government to remove all the bottlenecks, hindering contributors to the National Housing Fund from accessing loans to build their own houses. NAN
