FG 10,000 affordable homes: Nigerians seek legal backing

Nigerians from all works of life have risen in unison to support the Federal Government’s gesture to provide about 10,000 housing units for the citizenry. They believe that with the number of units aimed, many Nigerians will have affordable accommodation. However, most of them have their reservation that unless there is a legal backing for it that spells out guidelines for it allocation, it would go the way other housing schemes developed by government went.
According to Chief Emmanuel CM Akamobi, Chairman and CEO, Star Insurance Brokers Limited, the scheme is a welcome development because Nigerians who are not able to have huge sum of money to buy or build such homes could be helped through the mortgage scheme.
Chief Akamobi stated that even though he has some reservation on the 17 million housing deficiency, if about 10,000 homes are settled from the government perspective plus what the private developers do, then more Nigerians will be accommodated. He said that such would go a long way in not only reducing housing deficiency, it will also act on the pricing because there will be more supply which will help to reduce the price. He noted that these high cost of accommodation is more in Abuja, Lagos and PortHarcourt.
“My fear is that with no legal guidelines, these homes will like others in the past become commercial businesses. If they will model it the way we have Festac Jakande Estates in Lagos where individuals are given houses through streamlined mechanism, then the aim would have been achieved. Government should endeavour to see that those who deserve it are not cut out especially, traders, low income earners and the likes. If they through deposit of say, N1 million and so, then the the scheme is meant for the rich,” he said.
Mr. Johnson Chukwunweike, CEO, Cowry Asset Management Limited, in his reaction, said that the only way government gesture will make great impact is if it is supported by infrastructure. He said that unless there is road network for property developers to go to the hinterland and develop those areas, people will still cluster in the cities.
He said that Government should create the kind of mortgage financing that can stay afloat to finance the projects. He noted that most Nigerians do not own decent housing because the cost of securing an affordable decent housing is out of reach of the poor masses. “There should be legal framework to enable those the houses are meant for get it otherwise the same problem with the past schemes will repeat. It takes long time for government to issue certificates to land owners and that discourages potential homeowners,” he said.
Another real estate expert, Mr. Femi Ogunleye, said that the fact that federal government has gone into real estate will not stop the states from carrying on with their own schemes. He said that the issue if tackled from various angles will make great impact. Among what they will do is to help in bringing the road network that would easy movement in and outside of the estates.
Recently, the Federal Government launched the first 10,000 mortgages for affordable homes scheme. Speaking at the launch in Abuja, Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, said the mortgage scheme was inspired by President Goodluck Jonathan’s pledge on January 16, 2014 when he launched the Nigerian Mortgage Refinancing Company (NMRC) with a view to making mortgage accessible to Nigerians to enable them purchase and own their own homes.
She said that Nigerians can now apply and be pre-qualified for 10,000 mortgages to be provided by lenders.
According to her, “The NMRC is set up as a re-financing vehicle to provide mortgage lending institutions with increased access to liquidity and long-term funds. Since the ability of banks to deliver mortgage services is limited by the fact that 80 per cent of all banks’ deposits are for 30 days only, the NMRC, in ensuring greater access to finance for tenors of up to 20 years, will help accelerate the growth of the mortgage market for all income levels. Pre-qualification for a mortgage is a critical first step to home ownership. Once you are pre-qualified for a mortgage by a lender you are literally better armed and emboldened to look for a home to buy, within the limits of the mortgage provided. With the 10,000 mortgages scheme, Nigerians can now begin to realise their dream of owning a home and look forward to improved socio-economic outcomes,” she said.
Okonjo-Iweala also stated that the scheme is a private sector driven initiative, which the Federal Government initiated with strong support from NMRC and primary mortgage institutions and implemented in partnership with 21 pilot states. She said that unlike the existing mortgage scheme, which tenor is not more than 36 months, with the establishment of NMRC, mortgage subscribers can pay back between 15 and 20 years.
Okonjo-Iweala maintained that the scheme is part of Federal Government’s programme to help tackle the country’s 17 million housing deficit in a comprehensive and sustainable way, pointing out that the scheme is being coordinated by the Federal Ministry of Finance in collaboration with the Federal Ministry of Housing and Urban Development with strong support from the Central Bank of Nigeria (CBN), the World Bank, the African Development Bank (ADB), among others.
She also remarked that those who want to buy houses of N20 million or below were welcome to register, while husband and wife can also apply jointly, noting that each applicant must show evidence of regular income from his or her current employment, tax compliance and other requirements.
“People who are self-employed may also qualify provided they show evidence of regular income and a bank account. For self-employed persons, drawings from their businesses will be used as evidence of income,” she further explained.
Also, Minister for Lands, Housing and Urban Development, Mrs. Akon Eyakenyi, promised that her ministry was prepared to provide all the necessary inputs needed for the programme to succeed, while commending some state governments for collaborating with the Federal Government on the scheme.