Nigeria’s housing deficit accounts for about 39.3 per cent of Africa’s total, Shelter Afrique has said.
Shelter Afrique, a pan-African finance institution, said Nigeria had 22 million housing deficit out of the total 56 million on the continent.
The Chief Executive Officer, Shelter Afrique, Mr Andrew Chimphondah, who made this known during the signing of a memorandum of understanding with Family Homes Fund Limited, said Nigeria remained the firm’s biggest market and target for affordable housing.
He explained that one of the reasons for the MoU was to co-fund specific deals, share market knowledge and operate in line with best practices.
According to him, the core vision is to develop decent and affordable homes for all Nigerians and solve the affordability challenge in the demand and supply side.
Chimphondah said, “We are very grateful to get into a partnership with Family Homes Funds and we are delighted to sign the MoU. One of the things we realised when we re-strategised over the last few years is that beyond financing affordable housing, one of our strengths was leveraging our partnerships and networks.”
The signing of the MoU is expected to result in specific co-funded affordable housing projects which both organisations said had been identified as low-hanging fruit projects that would be affordable.
The Managing Director/Chief Executive Officer of Family Homes Funds, Mr Femi Adewole, said the MoU was a small but momentous occasion as Shelter Afrique had been a housing financing organisation for more than 35 years with significant experience across many countries.
“On the other hand, Family Homes Funds is barely a couple of years old. This partnership and relationship, birthed out of this MoU provides the beginning of what I hope and expect – and we will work assiduously for it to be a very successful relationship,” he said.
He added that both organisations would create houses for Nigerians who needed shelter the most.
Minister of Works and Housing, Babatunde Fashola has called for closer ties with the state governments to address housing deficit in the country.
He said that for the objective of providing adequate housing for Nigerians to be achieved, state governments should be on the same page with the Federal Government.
Speaking at the 8th Meeting of the National Council on Lands, Housing and Urban Development with the “Housing Development and Consumer Credit as Strategies for National Prosperity”, with representatives of the states of the Federation, Fashola, said the country cannot achieve much if all of its component parts are not contributing much as expected.
According to him, “no matter how much we intend to achieve in terms of housing, we need the states to work with us, while implementing their own programmes to also collaborate with us. That is the first important thing I want to say. Of all the National Councils of the various Ministries, perhaps the Council on Lands and Housing and Urban Development is perhaps the most important one.
“While the Federal Government wants to commit to Housing and Urban Development for its economic, social and other benefits, interestingly it is the state governments, who by virtue of the Land Use Act that control the land. So how do you build if you do not have land and that is why I say this council meeting is so important, because collaboration can be fostered. Land can be made available as it was done at the 2016 Council when we wanted to start the National Housing pilot project. It was the states who gave the land, the 34 states and I am happy to report that we are building in all those states today. We need that cooperation to continue.
“Also since 2003 the Supreme Court of Nigeria had determined that Urban Development and Planning is a matter exclusively preserved for the jurisdiction of state governments. So it is not just important for you to own land what you do with that land and how you use it is a matter solely controlled by the state.”
He continued that, “therefore whatever the FG seeks to achieve in terms of urban development, housing development, it needs collaboration with the states and this is important. It is important therefore that this collaboration must continue especially if Nigeria is to achieve her housing aspirations. The cooperation between us and the states must be the foundation of the prosperity we want to achieve; this is why we chose this year’s theme.”
THE Federal Ministry of Works and Housing on Tuesday assured that the Federal Government was fine-tuning plans aimed at reducing housing deficit in the country.
Its Permanent Secretary, Mr Mohammed Bukar, who spoke in Abuja at the technical session of the ongoing 8th Meeting of the National Council on Lands, Housing and Urban Development, said the government would create an enabling environment for greater sub-national governments and the private sector’s participation in addressing the nation’s housing problems.
The theme of the meeting was: Housing Development and Consumer Credit as Strategies for National Prosperity.
Represented by the ministry’s Director of Planning Research and Statistics, Dr Famous Eseduwo, the Permanent secretary said housing was one of the fundamental human needs in every society.
He said housing was a veritable indicator of standard of living in any society, adding that housing was currently in short supply and not affordable.
Bukar said the nation’s current National Housing Programme was an initiative specifically designed to encourage local manufacturers, professionals, artisans and craftsmen toward creating employment and wealth.
He said the housing programme had promoted the use of home-grown building materials in the construction of the houses, except where such materials could not be produced locally.
Bukar said the ministry was working in collaboration with the office of the Head of the Civil Service of the Federation and cooperative societies in providing affordable houses.
He enjoined the delegates and stakeholders to make meaningful contributions on the submitted memoranda to enable government formulate policies that would facilitate more Nigerian home ownership.
In an address, Dr Eseduwo said the event was in recognition of government’s new initiatives to generate more jobs and create wealth for Nigerians through affordable housing construction.
He identified factors militating against construction of affordable houses in Nigeria to include limited access to finance, high cost of land registration, lack of access to land and insecurity.
The event, which started on Nov.4, will end on Nov.8 and is being attended by the ministry’s directors, heads of government agencies, private developers and delegates from all states, professional bodies in the built industry and the academia.
Recently, the Minister of Works and Housing, Babatunde Fashola disclosed that the Federal Government is currently constructing affordable homes in 34 states of the federation. According to the Minister, this is part of the fulfilment of the model National Housing Programme, which is aimed at providing acceptable and affordable houses for Nigerians.
There have been various initiatives by the Federal Government to bridge Nigeria’s huge housing deficit, unfortunately, most of these initiatives have not yielded their desired results. We recall that the Federal Mortgage Bank of Nigeria (FMBN) established in 1956, (originally known as the Nigerian Building Society) had the strategic intent of supplying the mortgage and housing markets with sustainable liquidity in order to support the advancement of homeownership amongst Nigerians.
However, more than 60 years down the line, FMBN is yet to deliver affordable and modern houses to majority of Nigerians, despite the obvious untapped opportunities in the housing market.
In order to fulfil the mandate of FMBN, the bank was restructured into a Federal Government-Sponsored Enterprise under the reform of the housing sector based on 2002/2006 National Policy on Housing and Urban Development. This exercise birthed National Housing Fund (NHF) – a fund established with the objective of mobilising long-term funds from Nigerian workers, banks, insurance companies and the Federal Government to advance loans at soft interest rates to its contributors.
Under the NHF, all workers are to contribute 2.5% of their monthly salaries and loans are advanced to eligible workers at an interest rate of 6% per annum. The FMBN has the primary responsibility of managing and administering the Fund.
According to the FMBN, Nigeria’s housing gap is estimated to be in the region of 17 million units while homeownership is estimated at a low 25%. In our view, the challenges working against the development of the housing sector can be attributed to a plethora of factors ranging from low access to mortgage financing amid high cost of finance (c.22%-25%), rising costs of constructing houses attributable not only to the cost of factors of production but also regulatory costs of building or owning houses (Surveying fees, Certificate of occupancy, land settlement costs), shrinking disposable income particularly among the middle income earners.
Given that private sector participation in the low-end of the housing construction market has been limited, we believe that a more aggressive intervention by the government in subsiding mortgage financing and increased investment in housing development, will go a long way in bridging the housing deficit and help realise the improvement in homeownership that it desires.
Los Angeles, Calif. — Slated to open in early 2020, Hope on Alvarado is a pioneering concept in affordable housing created by HBG Steel, KTGY Architecture + Planning, and Aedis Real Estate Group. Located in the Westlake neighborhood of Los Angeles (166 S. Alvarado Street), the project employs advanced modular construction to transform steel modules sourced from China into a five-story, 84-unit residential building.
In addition to Hope on Alvarado, two additional developments using the same technology – Hope on Broadway and Hope on Hyde Park – recently received City of Los Angeles Measure HHH funding, a $1.2 billion bond to build approximately 10,000 units of supportive housing. The City chose Hope on Broadway ($6.7 million HHH loan) and Hope on Hyde Park ($9.3 million HHH loan) as part of the Proposition HHH Permanent Supportive Housing Loan Program (2018-2019 Call for Projects Round Three). The developments were awarded high marks for the following factors: location in a transit-oriented-community (TOC), geographic location in neighborhoods where housing is needed, the number of units designated as supportive housing, and strength of concept and development team.
“The partners of the Hope On developments have devoted themselves to perfecting this modular solution because we believe it holds great promise for the housing crisis,” says Aedis Real Estate Group President Scott Baldridge. “This is not just a one-off project. It’s a series of places created with a highly replicable design that delivers housing at a speed and scale required by neighborhoods in need.”
The designs for Hope On were conceived of by modular architect Peter DeMaria, chief design officer at HBG/Azria and KTGY Architecture + Planning, who was seeking a way to apply the innovative system of modules to a historically successful architectural design scheme. “The Hope On team has advanced technology using steel modules that have the potential to radically transform modular housing,” says KTGY Architecture + Planning Associate Principal Mark Oberholzer. “While site work and foundations are done on site, the modules are manufactured off-site with customized interior finishes and fittings, resulting in highly efficient speed-to-market,” which in turn allows the Hope On system to “accommodate larger-scale buildings on shorter time frames,” according to Oberholzer.
The design of each Hope On development is centered on a central courtyard, intended to provide privacy, safety, and to support a sense of community. A mix of studio and one-bedroom units (ranging from 400-480 square feet) will be available via County of Los Angeles social services. Hope On Alvarado is built to LEED standards, with speed of construction and efficient use of building materials among the project’s sustainable attributes.
Oberholzer describes the design of Hope On Alvarado as a “mixed-use, pedestrian friendly urban building, but instead of retail on the ground floor, there are services for the residents.” Residents will have access to community rooms, bike storage, parking, laundry facilities, and a supportive services suite, noting that case workers will be on staff “to support the residents as they transition away from homelessness.” Oberholzer explains that future Hope On builds may have a mix of street-level retail and support services, as the team works to “make sure each building ‘fits in’ with its neighborhood context.”
The Hope On team is cautiously enthusiastic about the transformative potential of this concept, as Oberholzer states that “Hope On directly serves the homeless in the form of providing supportive housing, but we are very aware that the very high rate of homelessness in Los Angeles can’t be solved only by building.” He notes that his team has seen “concerted efforts from many sectors–from developers building supportive housing, to public officials voicing and acting in support of zoning and policies that enable more help to come to the citizens of the city.” Oberholzer further states that “growing public awareness and the resulting voter-approved funding to support housing and services have begun to change the so-called stigma of homelessness,” adding, “I can’t tell you how many people I’ve met personally who have a relative living on the streets.”
“If a home is economical enough to buy and maintain but located too far from work or school, it cannot be said to be affordable.” – Alice Charles and Dilip Gunu, World Economic Forum
Rapid urbanisation has created a high demand for affordable housing in cities around the world. According to a recent report by the World Economic Forum, 90% of the 200 cities included in a survey were considered unaffordable. This was when you applied the widely-used standard of average house prices being more than three times the median income. The report also highlighted that the affordability of housing goes beyond the ability to buy or rent a home. It also means meeting expenses related to living there, for example, transport, access to social infrastructure and services.
South Africa is facing a massive urban housing crisis. The United Nations estimated that 68% of the world’s population will be living in urban areas by 2050, but South Africa is ahead of that curve. Government’s development plan acknowledges that 70% of our population is expected to live in urban areas by 2030. To eradicate the urban housing backlog and provide homes to cater for the increasing demand, an estimated 460 000 housing units would need to be built every year for the next decade.
A lack of housing is one of the most pertinent legacies of apartheid. Housing is also a fundamental need and is recognised as one of the United Nation’s 17 sustainability goals. So how do we solve the problem? Is corporate and private investment one of the solutions?
It might be. There is a powerful global trend of companies and investors realising the importance and need for impact investing (i.e., investments made with the intention to generate a measurable, beneficial social or environmental impact alongside a financial return). There is no doubt that investment in quality, affordable housing fits this bill.
In South Africa, government agencies like the PIC and Development Bank of Southern Africa have invested significantly in housing, mainly because it is a great vehicle to facilitate environmental, social and corporate governance (ESG) investing. Other current impact investors in the property market in South Africa include life insurance and asset management companies.
But meeting the demand for housing goes beyond just building shelters. If we want to make a real impact, we have to go about it the right way. Part of that is to purposefully design and build quality housing that will serve the life stages of the people who will live in them.
There are a number of factors that impact both the affordability of homes and the ultimate success of housing developments, including location, design, developmental and operational costs.
The location is a major determining factor. We have to be critical when it comes to the location of any new development and we advise our clients not to develop or invest in marginal sites. Great locations are where the people are; close to schools, work, public transport, social and other public amenities. If people can see themselves living there, we know it will not be a struggle to sell or rent out homes built there.
It’s also imperative to take a long term view when it comes to design and development – is the home to be sold or rented? How are operational costs impacted? It is especially important to be cognisant of operational costs when developing Build-to-rent (BTR) opportunities. Each element in the design has the opportunity to influence the ongoing operational cost, but it does provide opportunities to innovate on an ongoing basis. Costs also have to be strictly controlled to ensure that affordability is not only in terms of purchase or rentals, but also bears in mind living costs. This is where heat pumps, smart meters, solar energy and utility management software comes in.
It will take major investment and a concerted effort from a number of role players to transform our cityscapes with visionary placemaking, providing affordable homes to buy or rent that are fit for the needs of its residents. Cooperation and understanding is required as delays in, for example, getting approvals and then stalling contractors negatively affect both the cost and delivery of homes.
There is no easy one-size-fits-all answer to the challenge of providing affordable housing. It takes a layered approach, but we have seen that it can be done. It has to be done and we have to invest wisely to create communities where the people who keep this country going can afford to live, feeling safe and at home.
The housing crisis is a growing social issue with wide implications in cities around the United States. In addition to the homeless issue (hard to quantify and even harder to solve), the issue of housing affordability has made national headlines with 11 million Americans spending more than half their paycheck on rent, according to advocacy group Home1.
Nowhere is the issue of homelessness and housing affordability more visible than in the Bay Area, where a family of four making over $100,000 annually can be considered low income. Some point the finger at tech company wages in the area pushing housing costs skyward. While these higher tech salaries are a significant contributor, the reality is more complex and includes state and local regulations that limit new housing development.
No matter the cause, tech giants are feeling the pressure and the effects of a pinched housing market. Facebook, for example, has been forced to cut back growth in San Francisco and Menlo Park. “At this point, we’re growing primarily outside of the Bay Area,” CEO Mark Zuckerberg told employees earlier this month.
In an attempt to alleviate the issue (and possibly curtail some of the public criticism), the social networking giant announced last week that it would commit $1 billion to the cause over the next decade, working closely with the State of California. Facebook said their investment “will go toward creating 20,000 new housing units to help essential workers such as teachers, nurses and first responders live closer to the communities that rely on them.” Some of the funds will create housing for the homeless, as well.
Facebook isn’t alone in its massive commitment of resources to this issue. In June, Google also made a $1 billion commitment to boost housing construction in the Bay Area. Google also estimated their investment would result in 20,000 new housing units in the area. While housing advocates generally applaud the move by these corporations, they warn that the issues of housing affordability and homelessness are complex and that more work needs to be done to solve the issues.
Meanwhile, in Seattle, Microsoft pledged $500 million in January toward housing issues. In June, Amazon said that it would donate $8 million to nonprofits working with homeless populations in Seattle and Virginia where their corporate headquarters are located. Additionally, Amazon also made a $100 million commitment over ten years to homeless shelter Mary’s Place and announced that a 63,000 square foot family shelter within an Amazon office building will open early in 2020 and house 275 parents and children each night.
With millennials entering the home buying game, the rising costs of raw materials and labor to construct new housing units, increasing property taxes and Baby Boomers living independently for longer (or downsizing and competing for smaller homes with first-time home buyers), the issue of housing affordability and homelessness aren’t likely to disappear anytime soon. If anything, the housing market will continue to get even more constricted.
Whether this will push tech companies’ future expansion further from their home bases or force them to rethink their ‘investments’ in the affordable housing issue is yet to be seen. What I think is clear: The business sector is destined to play an even larger and multi-faceted role in shaping housing and urban development policy in the years to come.
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Boston says “thousands” of units will be returning to the market
Sheila Dillon, Boston’s housing chief and director of neighborhood development, said she expects a flood of apartments will hit the market in December when the city’s ban on investor units being used as short-term rentals goes into effect.
“We’re hoping that the units returning to the market will be in the thousands,” Dillon told the Boston Herald this week.
Boston last year banned the use of investor units for short-term rentals via Airbnb and other websites. In November 2018, Airbnb sued Boston in federal court over what it called “draconian” regulations. The company settled the suit in August by agreeing to add a function to its website that asks hosts to enter a city-issued registration number starting Sept. 1. Hosts that don’t provide the number by Dec. 1 will be blocked.
Dillon said an earlier estimate from Airbnb put the number of investor units – measured as units that are rented for most of the year, implying the owners don’t live there – at about 3,000. That’s about half of their listings for the city, the Boston Herald said.
Earlier this year Zillow cited Boston as one of the U.S. cities where the housing shortage has reached a crisis level. A shortage of housing units has been one factor driving both rents and home sale prices to levels that are more than double national averages.
“We’re hoping that more units coming on the market will increase the vacancy rate and units will continue to moderate,” Dillon told the Herald this week. “If we’re building additional housing to influence the rental cost, we need the units that were built to be residential units built to serve full-time residents.”
The average rent in Boston was $3,505 in September, more than double the national average, according to RentCafe. About half the city’s housing units are rentals and half are owner-occupied.
The median sale price of a Boston home was $650,400 in August, according to Zillow. That compares with a U.S. median price of $237,000.
The local government in Berlin has agreed to freeze rents in the German capital for five years as the city is battling with skyrocketing housing prices.
The Berlin Senate’s majority, which is composed by the Social Democrats, Greens and the Left party, approved the decision last week after months of discussions.
The plans will be sent to parliament this month, where they are expected to be approved and to take effect in January 2020. They also include measures to cap subletting contracts.
“We’re entering new territory,” said Berlin Mayor Michael Mueller. “Others talk about it, but we’re actually doing it.”
The clamp down on rent rise, one of the most extreme decisions taken by a Western capital in recent times, is being followed with close interest by other world cities.
The plan was initially proposed by the Left party. Katrin Lompscher, the party’s head of urban development and housing, said the intention was to “ease the burden” on tenants after a property boom which saw rents doubling over the last 10 years.
German house-builders’ and property companies’ shares were hit hard on October 21st. Deutsche Wohnen, Berlin’s largest private landowner, saw its shares fall by4.6%.Shares of Vonovia SE, the largest property company in the country, fell as much as 1.6%.
A separate grass-root initiative attempting to force Berlin’s local government to expropriate over 200,000 properties from large landlords is ongoing.
In August, Forbes.com revealed that Berlin is the city with the highest growth for prices of luxury real estate in the world.
For the second year in a row, the German capital had recorded the strongest price growth rate globally, with a 12% increase year-on-year – according to data from Knight Frank.
Could moving three generations of the same family into a specially-adapted home be a solution to the UK’s housing crisis? The Victoria Derbyshire programme met a family who have been taking part in an experiment in Kent.
“It’s really nice, because we’ve got quite a small family, so it’s nice to see each other all the time,” says trainee chef Dan Cotter.
The 18-year-old lives with his mum, her partner, his sister, niece and uncle in a specially-converted home in the seaside town of Margate.
It is an unusual set-up, pioneered by Kent County Council – which bought the run-down former hotel for £150,000 – and Thanet District Council, as part of a regeneration scheme in one of the most socially-deprived areas in the UK.
Almost £1m was spent converting it into a home appropriate for multi-generational living. Situated over five floors, it has three kitchens, five bathrooms and seven bedrooms.
The Cotters previously lived in three separate homes around the town.
Hospital sister Lizi lived with her fiance Richard, a chef, and Dan. Andrew, who works in a greenhouse nursery, lived on his own, while single mum Charli, who works in a supermarket, lived in another home with her six-year-old daughter Poppy.
Lizi spotted an advert for the experiment after her landlord said he was selling up. She fell in love with the house as soon as she saw it and persuaded the family to move in together.
“We had to go through an interview process with the university, the council, the letting agents and the people in charge of the regeneration project,” she explains. “So it was quite a long interview.”
The family are privately renting the house from Kent County Council for around £1,750 a month, plus bills – and say living together has helped them save money.
“We’re not all paying rents,” Richard Warrington, whose previous property cost £1,200 per month, explains.
“We’re not all paying separate electricity bills, gas bills, water bills, council tax and everything else. So we’re all now paying one lump sum for the house.”
The house was also designed to ensure it met high environmental standards.
For example, water from the washing machine is recycled for use in the toilet, which means a household of six people uses the equivalent of a two-person household.
Academics are monitoring how warm the house is, how much fresh air it has and how much condensation there is.
The impact of the family living together on care costs is also part of the study.
When they lived on their own, Charli used to struggle juggling child care for Poppy while she worked shifts. But now the family live together, she has more help.
“My hours do change, sometimes from week to week, so it does make it a little bit difficult with school runs. But with a little bit of help on hand now it’s nice she’s still being picked up by a family member,” she says.
Andrew, who has learning difficulties, is also feeling the benefits.
Lizi explains he has always lived an independent life, but had struggled to look after himself.
“He’s always been a bit of a loner, and quite happy in his own company, which is good, but he really alienated himself from the family and kept himself very secluded,” she explains.
But for Andrew, joining the rest of the family in the house was an easy decision.
“When Lizi said, ‘Oh, do you want to move in with us?’ I said, ‘Yeah, sure’. Because when I was on my own and I was working quite a lot, I didn’t get to see much of them.”
Hannah Swift, one of the academics who has been studying the family, said the factors which would make multi-generational living a success, vary from family to family.
“So the family that is living here has very specific care needs,” she says. “Other families will have different care needs. And the building itself will have to lend itself to that.”
Like all families, there are fallouts from time-to-time.
“As for domestic quarrels in the house, yes they do happen. But we all have our own space,” Richard explains.
Nick Dermott, heritage adviser for Thanet District Council, which contributed £74,000 to the refurbishment, says he believes it was a good use of taxpayers’ money.
“It’s an exemplar to other authorities as to what they can do with their historic housing stock, which is so often blamed as being the cause of the social ills in those areas. And if that stops buildings being demolished – which I hope it will – that has saved the entire country money.”
Dr Swift says that while the house has worked for this family, it might not work for everyone.
“Not everybody gets on with their own family, of course,” she says. “But I think it’s a solution that many people are looking for, and would like to have in the future.”
The family, which have lived there for a year, have had their contract extended for a further 12 months. But Lizi hopes it will be their home for many years to come.
“We’ve talked about the future quite often. They’ve given us an almost-guarantee that this would be a long-term thing,” she says. “And it would be lovely that this would be our forever home.”