Kunle Faleti is a United States of America-based affordable housing and mortgage finance advocate. He is of the opinion that a state must have a governor that understands the importance of housing to economic development in order to have a vibrant housing corporation. He speaks with DAYO AYEYEMI on solutions to underperformance of state housing corporations in Nigeria.
How can state housing corporations be revived to drive low-income and social housing?
In developed economies, state housing corporation means a corporation established by a State for the limited purpose of providing housing and incidental services, particularly for the families of low or moderate income. A housing corporation is an organization that focuses on building, managing and renting good quality housing with an affordable rent for people with a limited income (social housing). Housing corporations often manage large parts of a city through their development and maintenance of large quantities of houses. I believe that state housing corporations came into existence in Nigeria to fulfill the above. This can be traced to WEMABOD Estate of the defunct western Nigeria. Only a handful of states such as Lagos, Edo and perhaps Enugu can boast of very vibrant and profitable housing corporations. To survive, housing corporations must not rely solely on government funding. There must be strategic alliances, collaborations, joint ventures with private sector, foreign investors, nonprofit organizations to be able to deliver on social housing goals.
What has been the challenges of some of these housing agencies?
Today, most housing corporations in Nigeria are limited by their legally defined task and responsibilities. The challenge is simple – these MDA’a as the case may be are run as ministries. Pay is low, morale is low, measurable goals are not set; there is a dearth of skills set. You cannot run a housing corporation as a ministry and expect great results.
What modern model can be adopted to ensure they are afloat?
They must first and foremost hold a societal responsibility to provide good quality housing to those who cannot afford much. An housing corporation is not a Housing Finance Agency. In most states, they are set up playing dual role, which is roadmap to failure. Take Lagos for example, it has the Ministry of Housing, Lagos State Development and Property Company (LSDPC), Lagos Home Ownership Mortgage Scheme (LAGHOMS), Lagos State Real Estate Regulatory Authority (LASRERA), IBILE Properties and Bureau of Lands – this is a reason why it is successful in delivering social housing albeit some may disagree due to the cost of these houses. A state must have a governor that knows, appreciates and understands the importance of housing to economic development in order to have a vibrant housing corporation. If there is no passion and vision at the top, any policy relating to housing is as good as dead.
What is your take on the rising housing and materials costs?
The cost of building materials will continue to rise as long as there are no locally manufactured alternatives. It is that simple. When you rely on imported materials and needs every increasing foreign exchange, then costs will continue going up.
What are the implications?
The implications are that cost of finished products will be unaffordable; quality of buildings will reduce as a result of cost saving measures; there will be more cases of building collapse due to poor construction quality; and the low income bracket may never achieve their dream of owning homes.
What are the solutions?
State governments should position housing corporations as profit making agencies. They should employ highly skilled individuals and pay them comparatively to the private sector. State governments should provide enabling environments that will encourage partnerships and alliances with private sector stakeholders. Advocacy must be included in the core objectives and deliverables of housing corporations.