Fixing Nigerias affordable housing delivery challenges

Experts at the 15th edition of Abuja International Housing Show proffer workable solutions to Nigeria’s housing delivery crisis. DAYO AYEYEMI, reports.

MOST of the issues confronting affordable housing delivery in Nigeria were again brought to the fore when all stakeholders in the sector converged on Abuja, last week.

The event was the 15th edition of the Abuja International Housing Show (AIHS) and was powered by Messrs Fesadeb Communications, with the theme; Sustainable and Resilient Housing Solutions for a Post Pandemic World.

The experts, which include local and foreign, decried some of the factors inhibiting affordable housing delivery in the country despite the 17million deficit and also proffered workable solutions to get out of the wood.

Some of the inhibiting factors, they mentioned included high cost of funds, limited sources of funding for real estate development, high construction cost, poor infrastructure, prohibitive cost of building materials, currency risk, government’s bureaucracy, low purchasing power, security issues, economic contraction, general inflation, high unemployment rate and devaluation of the naira, among others.

They noted that the impacts of COVID-19 had further weighed down on low-income groups and the economy.

To resolve some of these issues and promote affordable housing delivery among citizens, the experts said such collaboration among stakeholders is required, adding that they must work together as a team to unlock real estate’s potential.

They stated that housing is considered affordable if its costs (mortgage or rent) are below 30 per cent of household income, pointing out that access to quality affordable housing is fundamental to reducing poverty, improving the socio economic landscape and providing for sustainable development.

This year’s event was declared open by the Minister of the Federal Capital Territory (FCT), Mallam Mohammad Bello, represented by the Permanent Secretary, Adesola Olusade.

Experts’ views

Speaking at the event, Managing Director of UPDC Plc, Odunayo Ojo, stated that $363 billion is needed to tackle housing deficit in Nigeria, identifying land’s allocation costs, high cost of building materials, inadequate access to finance, high cost of infrastructure, taxes and fees, bureaucracy and lack of cooperation between different sectors among other factors responsible for high housing prices in the country.

He stated that provision of affordable housing is achievable through the creation of appropriate synergies and collaboration amongst various stakeholders.

According to the UPDC’s CEO, providing affordable housing is a social need and an important tool for economic development.

“The benefits of providing affordable housing are far reaching and could provide the well needed job creation and empowerment for the Nigerian youth,” he said in his presentation on “Building Support for the Affordable Housing Agenda Through Collaboration’.

While enjoining the need to promote contractual relationship between public and private sector, Ojo urged government to provide land with good title to developers, adding that it should also waive taxes, fast-track approvals and provide strategic partnerships.

On the part of the private sector, he said there was need to provide development expertise, provide development capital and execute plan

Ojo urged stakeholders to leverage on respective strengths, share industry knowledge, strategies, expertise and ideas to tackle various areas of affordable housing.

In order to build support for affordable housing agenda through collaboration, Principal Private Sector Specialist, African Development Bank Group, Mr Emmanuel Akinwumi, told the participants-real estate developers, housing and mortgage finance providers, building materials manufacturers, insurers, surveyors, engineers, architects, builders and town planners-that there was need for paradigm shift from silo housing development to building as communities

He called for collaboration among all stakeholders in the building of housing infrastructures, financing, structures and services, adding that they should partner in affordable housing ownership and affordable rentals, including rent-to-own

Besides, he urged government and other policy makers to establish and implement laws property occupancy oversights to deal with persons abusing their authorised land-use and turning themselves to noxious neighbours.

Managing Director, FMBN, Arc. Ahmed Musa Dangiwa, stated that public investment in housing must include increasing capacities of public housing institutions

According to him, government-owned Housing Finance Institutions such as FMBN must be empowered to deliver services to the affordable and social markets which will become more underserved by the private sector

Generation of data

President of the Housing Development and Advocacy Network (HDAN), Mr Festus Adebayo, disclosed that partnership between AIHS and the National Bureau of Statics (NBS), the Central Bank of Nigeria (CBN), among other critical stakeholders was underway towards addressing the issue of inadequate data which, according to him, is the greatest challenge to housing development.

CEO, Lexon Capital, Ify Ummunakwe – Okeke

Private-Public Partnerships

On ways to reduce housing deficit, CEO, Lexon Capital, Ify Ummunakwe – Okeke, suggested Public Private Partnerships, which encompasses granting of affordable housing in exchange for land allocation.

Besides, she urged the government to establish and implement monetary and fiscal policies to stimulate rapid economic recovery; lower interest rates for developers and purchasers and to ensure easier access to construction funding on less restrictive terms.

“A housing fund targeted at developers will help bridge the liquidity gap,” she said in her presentation on ‘Housing Finance in a Post COVID-19 Era: Lessons and Opportunities for Emerging Markets.’

According to her, there was a need to encourage local manufacturing of building materials, and to also increase earnings of salaried workers in the public sector to get people on the housing ladder earlier.

“There is a need for improved Technical Schools to boost supply of skilled and semi-skilled labour force and also improve re-mortgaging processes and options,” she added.

She suggested that the Primary Mortgage Institutions (PMIs) should be moved from the National Housing Fund (NHF) structure to providing liquidity to primary lenders and promotion of a secondary market, while ensuring better certification processes and building codes for structural quality and delivery times.

She mulled the need for the CBN to provide liquidity for DMBs through swapping of mortgage assets with treasury bills.

According to her, there was a need to reduce statutory costs for land transactions and give tax waivers or incentives for developers of affordable housing.

She warned that failure to stem the growing deficit in the supply of affordable housing would have severe impact on the social and economic development of the country.

Adoption of 3D Construction

Director, Steinbeis Institute of Material Applications and 3D Printing Solutions (IMAPS), Professsor Brando Okolo, canvassed the adoption of 3D Construction Printing technology, pointed out that with traditional construction methods, the nation’s 22 million housing deficit gap won’t be closed in record time over the two next decades.

He pointed out that the entry of 3D Printing technologies into the construction industry had opened a path on which portions of the workflow in the building construction industry could be digitalised, human footprints reduced and materials (especially concrete) can be economically used.

Green building

Another expert, Olivia Nielsen of Miyamoto, said there was need to focus on new homes and existing homes (mortgages and housing upgrades), adding that new housing must be built green and resilient, and that old homes must be retrofitted to address the upcoming crisis

“Housing has transformational impacts on other sectors including: Public health, economy, environment and inclusion,” he said.

According to him, there was clear correlation between overcrowding and higher COVID-19 death rates, noting that housing could speed up economic recovery, and that housing construction creates more jobs than other construction sectors.

He stated that climate resilience and sustainability is a key factor in this area, warning that the pandemic was a small crisis compared to climate change, noting that international actors have been calling for a green and climate resilient recovery.