The assets of Nigeria’s pension industry regulator, PenCom, which grew to N14.36 trillion as of the end of July 2022, will boost the growth of the country’s mortgage and housing loan market, a real estate investor, Mr. Olayide Agboola, has said.
Agboola, the Chief Executive Officer of Purple Real Estate Income Limited, who disclosed this in an interview recently, said PenCom’s approved policy which allows workers to access 25 percent of their Retirement Savings Accounts (RSAs) contributions as equity payment to facilitate a residential mortgage is a good development for the housing sector.
He said: “In an attempt to facilitate pension fund activities in Nigeria, the pension industry regulator, PenCom which has seen assets swell to N14.36 trillion as of the end of July 2022, approved guidelines allowing workers to access 25 percent of their Retirement Savings Accounts (RSAs) contributions as equity payment to facilitate a residential mortgage. This policy is expected to boost the growth of the country’s a mortgage and housing loan market.
Agboola called on real estate developers to engage in the development of social housing and infrastructure projects that will significantly improve the lives of average Nigerians.
“Take into account student housing and retirement homes, both of which are typically long-term investments. Access to pension funds and other untapped sources of finance should be improved. These funds will go a long way in improving the infrastructural developments and the quality of life of Nigerians’’, he said.
He made a case for the replication of the Lagos State Real Estate Developer Database initiative across the county to increase the safety and control of real estate transactions.
“The government has made some efforts to support the industry, particularly through the National Housing Fund and other initiatives. National and sub-national governments have also implemented important interventions, such as the Lagos State Real Estate Developer Database through LASRERA, to increase the safety and control of real estate transactions. Initiatives like these should be replicated and implemented across the country to unite the industry and protect the public’’, he said.
On the challenges confronting the sector, and the way forward, he said: “The underdevelopment of the mortgage market affects the growth of our real estate and property development sector. A lack of available data and providers’ unwillingness to lend can make home and property ownership inaccessible to many. Therefore, more data is vital to help understand the immense opportunity.
“Our industry also needs more policies that will stimulate investment. With more partnerships between the government, local and international investors, and developers on policies that improve the ease of doing business, we can boost access to space for individuals and unlock potential among businesses that remain underserved.
“Our country’s infrastructure deficit has been a consistent development priority for real estate developers since our businesses have to navigate the undersupply of power and upgrade unpaved roads to paved standards – this contributes to the complexity and cost of projects’’.