FG, States Seek Single-Digit Mortgage Rates to Boost Affordable Housing
The Federal Government and state governments are seeking single-digit mortgage interest rates as part of efforts to improve access to housing finance and make homeownership more affordable for Nigerians.
The push for lower mortgage rates comes amid persistent challenges in the housing sector, including high property prices, rising construction costs and limited access to long-term financing.
For many Nigerians, purchasing a home remains difficult because mortgage payments and initial equity contributions are often beyond their financial capacity. Lower interest rates could help reduce borrowing costs and make housing loans more accessible, particularly for low- and middle-income earners.
Lower Mortgage Costs Could Improve Homeownership
Mortgage financing remains an important part of efforts to bridge Nigeria’s housing gap. However, high borrowing costs can prevent prospective homeowners from qualifying for loans or meeting monthly repayment obligations.
Single-digit mortgage rates would reduce the cost of borrowing compared with higher commercial lending rates, although the actual benefit to borrowers would also depend on loan duration, eligibility requirements, deposit obligations and the price of the property.
The proposal also highlights the need for stronger cooperation between federal and state governments, mortgage institutions, financial organisations and private developers to expand access to housing.
Housing Finance Reforms and Existing Programmes
The Federal Government has introduced housing-finance measures through the Ministry of Finance Incorporated Real Estate Investment Fund, which provides long-term capital to participating financial institutions for residential mortgages.
According to a State House update published in August 2026, the fund had disbursed ₦140 billion through 21 financial institutions, supporting 2,018 mortgages across 27 states. The programme offered eligible borrowers a fixed annual interest rate of 9.75 per cent, with repayment periods of up to 20 years.
The government also reduced the minimum equity contribution from 20 per cent to 10 per cent under the programme, with eligible contributors to the Contributory Pension Scheme able to use part of their retirement savings towards the contribution, subject to applicable regulations.
These measures reflect ongoing efforts to address the financing barriers that prevent many households from moving from renting to homeownership.
Collaboration Needed to Expand Affordable Housing
Improving mortgage affordability alone will not resolve Nigeria’s housing challenges. The supply of suitable homes, the cost of building materials, access to serviced land and the availability of supporting infrastructure also affect the final price of housing.
Greater collaboration between government agencies, mortgage providers and private developers could help align housing supply with the financing available to prospective buyers.
For lower mortgage rates to deliver lasting benefits, housing-finance programmes must reach eligible households, offer repayment terms that match their incomes and support the development of homes that people can realistically afford.
Note: This draft requires verification against the full original report before publication. The article’s specific statements, named speakers and details of the federal-state discussions could not be confirmed from the inaccessible source page.
