Affordable mass housing delivery in the face of housing deficit has remained a major challenge to real estate developers in Nigeria,. But despite the different innovations that have been introduced into the sector by think- tank development experts to ease this problem, the sector is still left to contend with the lackadaisical and non committal attitude of the nation’s legislature towards helping to create a conducive atmosphere for the Industry in creating regulatory policies.
Despite efforts by a number of individuals and lobby groups in getting the National Assembly to deliberate on, and pass a good number of bills before the two Chambers, aimed at creating laws to regulate the housing sector, the lawmakers have displayed reluctance in that direction.
Although there had been various promises made by some Nigeria’s lawmakers to convince their colleagues in both the Senate and the House of Representatives to accelerate passage of the various housing development bills before the two chambers, all have been mere lip service.
Chairman of the Senate Committee on Housing Sam Egwu, had
sometime ago during an event organized by the Real Estate Developers Association of Nigeria (REDAN), promised that the National Assembly (NASS) would give necessary support to stakeholders in the housing sector towards reducing Nigeria’s housing deficit.
He said the NASS committee would give priority to bills seeking to address challenges in the housing sector so as to make suitable, adequate and affordable housing available to all Nigerians, but several years after those bills are still there untouched.
Nigeria is perhaps facing the worst housing deficits in its existence with a homeownership of less than 20% and a housing shortage greater than 30 million according to reports. The deficits would lead to a crisis and consequently lead to poor standards of living, unaffordable house prices, high mortgage payments, abandonment, outbreak of diseases, dilapidation, and high maintenance costs hence the need to develop a framework for housing governance which is what Nigeria’s housing intellectuals have put together in form of bills before the NASS and are eager to see such documents passed and signed into laws.
There is a unanimous conclusion that the problems in the housing industry can be explained by policies, regulations, legal issues, market, economics and the construction industry. For now, the government has to play multiple roles of providing housing and that of a market enabler. A country with adequate housing also means that such a country would spend less on the preventions and controls of diseases, and reduction in crime rate and enhancement in social integration. For the pensioners or retirees, housing is required for.
In 2012 the National Housing Policy was formulated to replace that of 2006. The policy was not majorly different from existing policy of the previous administration. The thrust of the 2012 policy was the introduction of mass housing for the purpose of providing houses for Nigerians regardless of their financial status. The private sector was given an important role to perform while government was assigned the role of a regulator in the sustainable development of the housing sector. Also introduced was the concept of social housing with the hope of ensuring that the low-income earners had access to housing through the low-cost housing to be developed for them.
The difficulty of bridging the housing deficit was expressed by former President Jonathan on January 21, 2013 when he said that Nigeria needs about N56trillion to bridge the country’s 17 million housing units’ deficit and claimed that if government were to build 10, 000 units every year, it would take 1700 years for the country to meet her housing need assuming that the demand for housing remains unchanged! In a way, this was tantamount to despair or a statement of hopelessness of the housing sector. In 2014, the Federal government launched the first 10, 000 mortgages for affordable home scheme and also launched the Nigerian Mortgage Refinancing Company (NMRC) with a view to making mortgage accessible to Nigerians to enable them to purchase and own their own houses. The 10,000 mortgages scheme was however derailed by the inconsistency of government policies.
With the coming of the Buhari administration, the APC-led government promised to amend the constitution and the Land Use Act to create freehold/leasehold interests in land along with matching grants for States to create a nationwide electronic land title register on a state by state basis. Buhari also pledged to create an additional middle class of at least 2 million new home owners in the first year in government and one million annually thereafter by enacting a national mortgage system that would lend at single digit interest rates for the purchase of owner occupier houses. After Buhari took over the mantle of power however, the economy faced a number of challenges. The first was the crash in the prices of oil. The revenue of the government is dependent on oil revenues to the tune of over 80 per cent. Thereafter the economy dipped into a recession in 2016 and the housing industry was hard hit. In 2017, the impact on the sector was grave and the developers had to swallow the bitter pills. Quite a number of them had to re-assess their investment strategies
in order to remain afloat while others looked for incentives to give to would-be-buyers. Apart from all these problems, the menace of Boko Haram and the dislocation of persons associated with it was a big drain on the budget of the government. All these negative economic trends had effects on the performance of the government in the area of housing provision. In a move to boost housing development, the Federal Mortgage Bank of Nigeria in conjunction with Nigeria’s Labour Congress (NLC) and Trade Union Congress (TUC) and Nigerian Employer Consultative Association (NECA) commenced the implementation of a national affordable housing delivery program for Nigerian workers.
while concerted efforts may have come from the Executive arm of the government, there are needs for redirection of certain policies in the industry of which are captured in the bills awaiting passage, including those submitted by the Real Estate Developers Association Of Nigeria (REDAN), ‘Real Estate (Regulation and Development) Bill’ which will address all anomalies of real estate and consultancy services amongst other issues that ought to be looked into in the sector.
While many of the bills have not been read, a few have passed through second reading without further action. These bills includes the Land Use Act 1978; Mortgage Banks Act 1989 (Subsumed in BOFIA); Federal Mortgage Bank of Nigeria (FMBN) Act 1993; the Trustees Investment Act 1962; and the Nigeria Social Insurance Trust Fund (NSITF) Act 1993.
The National Housing Fund (NHF) Scheme Act 1992 was actually amended, passed and sent to the President for assent, but it was declined after the realisation that the bill was defective and put together without a wide consultation and input from all relevant stakeholders.
Others are the Insurance Act 2002; Investment and Securities Act 1999; Federal Housing Authority (FHA) Act 1990; Securitization Bill; Foreclosure Law Bills – Residential Mortgage Act and Residential Mortgages (Incentives) Act, among others. Adebayo stated that no effective mortgage system would be possible in the housing sector without reviewing and amending some sections of the Land Use Act of 1978.
