In order to increase activities and stimulate growth in the housing/real estate sector in 2022, professionals have come out with various suggestions on what could be done to improve the industry and enhance home ownership among Nigerians. DAYO AYEYEMI, reports.

There are many opportunities in the housing sector to grow the economy if the necessary incentives are in place. To tap into these opportunities in the new year, stakeholders in the industry are calling on government at all levels to muster the required support to promote affordable housing production.

Such support for affordable and mass housing delivery, according to them, could come in the form of provision of  primary infrastructure, development of guidelines, provision necessary  guarantees for  private developers, development of  a database and research for alternative building materials, among others.

Some of the experts in the built environment that gave these suggestions include the former spokesperson, Lagos chapter of the Nigerian Institution of Estate Surveyors and Valuers, Richard Olodu; US-based housing finance expert, Mr Kunle Faleti; Managing Director, Fonahanmi Idris & Associate, Mr Fonahanmi Idris; and two others who identified themselves simply as Harmony and Ebony on the social media platform of the Housing Development Advocacy Network (HDAN).

To enhance home ownership among Nigerians in 2022, Idris said the government must provide enabling environment and support for alternative building materials.

In addition, he urged the authorities to provide primary infrastructure and import subsidy via duty/Value Added Tax (VAT) exemption/reduction to encourage investors/private developers.

According to him, the central authority must support housing finance institutions via recapitalisation of the Federal Mortgage Bank of Nigeria (FMBN), adding that it must support housing developers via concessionary loans at a reasonable pricing and also offer support to beneficiaries via multiple housing products (i.e. rent to own, renovation, mortgage upgrade, etc.)

“Government must make ministries, departments and agencies (MDAs) – Central Bank of Nigeria (CBN), Security Exchange Commission (SEC), Family Home Fund (FHF), Nigerian Mortgage Refinance Company (NMRC) and Pension – work positively for the housing sector benefits,” Idis said, suggesting that the Primary Mortgage Bank should be strengthened.

Another expert, Harmony, said there would be a need for the development of related and support regulations, standards and guidelines with the appropriate authority for approvals and wide publications.

Besides, he explained that there would be a need for the understanding of mass housing / affordable housing projects’ funding requirements from international providers (United Nations Office for Project Services (UNOPS), Shelter, CDC UK, International Finance Corporation (IFC)) and providing the private developers the necessary guarantees to enable the release of funds for housing projects.

“Such funding organisations can sponsor housing projects from 500,000 units to above one million units on a project with a developer and multiple in one country at interest rate usually below six per cent,” he said, urging the Federal Government to provide the relevant support for this instead of depleting the CBN to fund housing projects.

On areas that needed improvement, the affordable housing expert said it was high time to   be developing and publishing a database for approved building technologies in Nigeria.

Focus of government

Harmony urged the Federal and State governments to focus on providing infrastructure to support housing projects as being done in other countries.

According to him, it should not be the responsibility of the private sector or developers to build roads provide drinking water and provide electricity to the citizens in their various housing projects.

He said “It is the government’s responsibility and the revenue accrued from such facilities goes to the government. Government pre-invests by building the infrastructure but gain from them when the users start paying for the services.

“Such infrastructure is usually between 10 per cent and 25 per cent of total project cost and if that is removed from the cost of housing construction, it lowers the construction cost and house sales price will be lower.”

Funds for such infrastructure, the expert said, could also be tapped from tax credits related to the housing construction projects to reduce delay time in government’s approval of budgets.

According to Harmony, such infrastructure would help the government to identify other areas where it can reduce overall cost on construction which includes VAT exempt on building materials that are locally produced or manufactured in Nigeria.

“It will reduce PAYE rates for all construction workers on housing projects and building materials factories to encourage the developers or factory owners to employ more people,” he said.

To improve the sector in 2022, the housing expert called for capacity building among the various agencies of government in charge of building technology and modern documentations, processing of construction approvals and inspections.

According to him,  the Federal and state governments must  make available approved procedures and guidelines for construction permit approvals and inspections requirements, including mandatory requirements for Environmental impact assessment (EIA) for housing projects with more than 50 housing units

“Federal and state governments should make available expropriated lands in each state for the purpose of affordable and mass housing projects only.

“Houses within such lands should not exceed N15 million  per unit (10 per cent maximum) and others from N1 Million to less than N15 million making 90 per cent.

He also called on the government to  consider provision of positive incentives to investors to build factories in the country  for producing building materials locally that are mostly imported or based on new building technology that support affordable and mass production housing units.

Contributing also, Faleti urged the government to continue its efforts towards creating an enabling environment for the private sector and direct foreign investments into the sector.

“Such initiatives include improving upon the ease of doing business; promoting tax breaks on importation of housing related construction/ building materials; implementing in full existing interventions on housing finance such as the Nigerian Housing Finance Program and Family Homes Funds,” he said.

To solve some of the challenges confronting the sector, Faleti said it would require a combination of efforts and collaboration among stakeholders.

Faleti said “This will take some time before the impact is felt. The liquidity fund that saw to the emergence/creation of the Nigerian Mortgage Refinance Company (NMRC) is still struggling because not all the components are fully implemented.

“The other three components (Mortgage Guarantee Insurance, Housing Micro-Finance and Technical Assistance) are yet to be fully implemented. If all the four  are operating simultaneously we will have single digit interest rates on home loans.”

Just like other speakers, Faleti also advised the government to invest in and fund research for locally produced building materials, adding that the government could introduce high taxes in the form of policy to discourage importation of luxury items.

“Our universities and other higher institutions of learning should collaborate with government owned research institutions and professional associations to develop local content,” Faleti stated.


Another expert, Ebony called for sustained advocacy for affordable housing production, urging the Real Estate Developers’ Association of Nigeria (REDAN) to lead the campaign.

He said “It’s high time we refocused attention on effective alternative funding sources for housing production to enable us to address both the demand and supply side of housing system.

“We should reconceptualise housing and see it from the perspective of a commodity so that we can transit to the level of high scale production of housing.”

To stimulate housing growth, he tasked the government on the provision of an enabling environment for housing production.

“How can you compare the government that produced a one-bedroom apartment at N9 million with fuller housing that is producing at less than N2 million. Let the government make the environment friendly for housing experts,” he said.

In his contributions, Richard Olodu said that getting affordable funds for housing development could only be made possible through the Real Estate Investment Trust (REIT), securitisation, social housing estates and cooperatives housing society.

On rising building materials’ prices, he said that there was a need to considerably improve the local contents in the building process, especially the materials.  According to him, clay could be used for bricks as walling and terracotta (clay tiles) as roofing materials.

“Plastics from wastes can be used for window and door profiles instead of aluminium and timber used as ceiling material since we are in tropical region with large expanse of forest.

“We can adopt timber floor for our two floor houses and bamboo as reinforcement.”

“With serious articulation, we can solve our housing challenges in Nigeria. We also need laws to control “false housing starts”. There are too many unmarketable houses in our property market,” Olodu said.