• Stakeholders say new plan may suffer funding setback
In an effort to address Nigeria’s housing shortage if elected, the All Progressives Congress presidential candidate, Bola Tinubu has stated that the party intends to combine all federal government agencies responsible for home ownership into a single large entity.
Industry stakeholders, however, praised the plan but predicted funding difficulties.
Tinubu claims that this new organisation will take over the responsibilities of current housing authorities and will receive adequate funding from the federal government.
Collapsing the agencies into one is a good idea, according to Obinna Chilekezi, principal consultant at Intes Training & Edu Services Nigeria, because it would cut down on waste and bureaucracies in the system.
“However, the idea of funding it by the federal government is where I don’t agree with the plan,” he said.
He said: “The past few years have been pressured with dwindling revenue for the government; so where is he going to get money to fund the project? For me, these are mere promises; when they get there now, it becomes stories like what we have seen.”
“I believe a well-thought-out policy that makes land available for developers is ideal, and where it is available, high-rise buildings with blocks of flats are better and economical for effective land utilisation.”
Tinubu’s plan is contained in the party’s action plan for a new Nigeria titled “APC’s Renewed Hope 2023’.
On mortgage and consumer credit reform, Tinubu said the various federal agencies meant to promote home ownership are too small and fragmented.
He said to address the housing deficit, he would ensure greater cohesion and efficiency by merging these agencies into a new, more competent body.
“This new entity will inherit the functions of existing housing authorities and shall be adequately capitalised by the federal government,” he said.
The agency, according to the manifesto, will have a three-fold mandate: grant low interest rate mortgages directly, guarantee qualified mortgages issued by banks, and purchase mortgages from private banks.
“The guaranteeing and purchasing of mortgages will incentivise banks towards mortgage lending and will deepen the secondary mortgage market.”
The document said banks would also be encouraged to engage much more in the provision of affordable consumer loans for automobiles and expensive domestic appliances.
“A certain portion of bank lending must be earmarked for the consumer. All non- compliant banks will pay a penalty to the government. Compliant banks will be entitled to tax breaks and credits as well as favourable treatment by the CBN regarding inter-bank transactions and other monetary policy ratios,” it said.
Joseph Aderinokun, an estate surveyor, said, “I am yet to see the document, but if I understood you correctly, this is not the time for the government to continue to manage businesses. So, Tinubu’s plan to fund housing mortgage will be another government in business and it has never worked in Nigeria.”
According to him, rather than plan to recapitalise a mortgage agency to take care of housing, it should concentrate on making lands available and create policies around access to funding that enable banks to fund mortgage projects.
The manifesto described home ownership as a source of prosperity, social stability and individual pride, adding: “A vibrant residential construction industry is essential to a healthy modern economy.”
It said in conjunction with the National Assembly and state governments, the Land Use Act would be reviewed and revised.
The document said: “We need to streamline and rationalise the land conveyance process. In this way, we lower costs and delays and promote more efficient use of land. This more efficient allocation will bolster the housing industry and lower costs for investors and consumers.
“Working with state governments, we will provide credits and incentives to developers of housing projects that set aside a significant portion of their projects to affordable housing.”
It added: “With the support of state and local governments, we aim to establish and implement a new social housing policy whose objective shall be to provide pathways for the poorest Nigerians to climb onto the housing ladder.
“We will establish a coherent federal programme to provide eligible and meritorious civil servants with federal payment guarantees for fixed-rate, long-term mortgages for their homes.”