FG restates commitment to affordable housing, embarks on fresh investment

FG Plans N3.53trn Fresh Investment To Tackle 17 Million Housing Deficit Economy
FG Plans N3.53trn Fresh Investment To Tackle 17 Million Housing Deficit Economy

The Federal Government has restated it’s commitment to affordable housing in the country as it plans to embark on fresh investments of N3.53trn in the Nigerian housing sector.

This is to reduce the deficit in the country which is estimated at about 17 million houses.

The investments, to be made within the next four years is part of the strategies of government to boost housing delivery and guarantee affordable houses for Nigerians.

Details of the four-year plan is contained in the National Economic Development Plan of the Federal Government, which was launched last December by President Muhammadu Buhari.

A copy of the document, which was obtained by Africa Housing News, showed that the N3.53trn includes an estimated public investment in the development of urban road of about N1.68trn.

These allocations, according to findings, have been made to priority projects in the sector as well as projects essential to the operations of the relevant Ministries, Departments and Agencies.

Nigeria has experienced rapid yet uncontrolled urbanisation, which put intense pressure on an already stretched housing infrastructure.

Nearly 50 percent of Nigerians currently reside in urban areas, which represents almost 100 million people.

Over the years, housing supply constraints and asymmetric information on existing housing policies have prevented Nigeria from keeping up with the rapid urbanisation rate.

Also, lack of policy continuity arising from political risk and change of government over the years have stifled government efforts thus, explaining the gap between the availability of affordable housing and the demand due to rising population.

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Furthermore, the sector faces other hurdles such as proper land administration constraints; weak adherence to real estate market regulations; unhealthy speculation by stakeholders in the sector; low private sector involvement, poor housing database and mapping constraints as well as rising cost of building materials.

These challenges have all contributed to severely curtailing access to land despite the government’s best efforts to reform the mortgage sector.

But the government’s blueprint for the sector covering 2021-2025 stated that despite these challenges, the increasing demand for housing because of rapid urbanisation could be leveraged as a considerable engine for growth.

It stated that building affordable houses to fill the shortfalls will increase demand for housing-related financing and drive liquidity of mortgage finance products.

According to the document, massive housing construction will also significantly boost demand for locally crafted materials to reduce construction costs as well as stimulate job creation, particularly in the construction and manufacturing sectors of the economy.

To improve access to affordable housing in Nigeria, the document stated that between 500,000 and one million houses will be delivered annually within the next four years.

The document also stated that the government will improve linkages between the housing sector and the economy with emphasis at improving urban development across the country

It said, “To achieve the goals outlined in the housing sector, the estimated public investment is N3.53trn from 2021-2025. This includes an estimated public investment in the urban road development of about N1.68trn.

“These allocations have been made to priority projects in the sector as well as projects essential to the operations of the relevant MDAs.

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“Both Federal and state governments will make the construction of affordable housing a priority to bridge any housing deficit, reduce slums and create opportunities for sustainable urban regeneration in Nigeria.”

The document stated that securing the availability of long-term housing financing to facilitate access to home ownership for everyone will ultimately improve social inclusion and allow low-income Nigerians to build wealth.

“The achievement of these goals will be underpinned by an inclusive national housing policy that will fully unlock the socio-economic potential of the housing and urban development sector.

“The operational efficiency of the Federal Mortgage Bank and the Family Homes in collaboration with the Primary Mortgage Banks and the private real estate firms will be a priority,” it added.

On the disparity between urban cities and the rural communities, the Federal Government stated that this will be bridged through efforts to engender rural development across all states to ensure access to infrastructural facilities.

It added that efforts towards facilitating urban development across the country would be increased during the implementation period of the blueprint.