…Sues for affordable mortgage products to match current economic realities

Minister of Housing and Urban Development, Arc. Ahmed Musa Dangiwa has called on heads of mortgage banks to be creative in developing mortgage products for Nigerians. The Minister said Nigeria’s current economic challenges call for innovative solutions that will make housing finance more easily accessible to Nigerians, and at affordable rates.

Speaking during the 20th edition of the Mortgage Banking CEOs Annual Retreat at the Transcorp Hilton Hotel in Abuja on Saturday 2nd December 2023, Arc. Dangiwa said CEOs of mortgage banks must find new ways to navigate the harsh macroeconomic environment and ensure that ordinary Nigerians- especially those in the low-and-medium-income bracket- can access the finance they need for homeownership.

“While the government works to fix this macro-economic challenge, I still believe that as CEOs of mortgage banks, you can find creative ways to develop innovative mortgage products that are responsive to Nigeria’s current economic situation. This includes adopting rent-to-own mortgage options, and flexible monthly mortgage loan repayments to make commercial loans more affordable.

“I note with concern that the Capital Market has not been maximally tapped to raise long-term funds to refinance mortgage loans and to explore more creative ways to make mortgages more affordable even as we work to fix the larger macro-economic problems. As leaders, we must not only see the provision of housing and home loans from a business and profit perspective but also see expanding access to affordable mortgages as a moral imperative. So, we must do all we can even in these difficult times to ensure that not only the elites, but Nigerians within the low- and medium-income segments have access to affordable mortgages,” he said.

While he acknowledged the presence of legacy challenges and barriers that hamper development in the sector, he charged the mortgage bankers to see themselves as leaders with a moral imperative to make housing more affordable and easily accessible to Nigerians.

The Minister noted that the theme for this year’s retreat, “Advancing Sustainable and Affordable Housing in Nigeria: Navigating Macro-Economic, Legislative, and Policy Frontiers”, clearly captures the need of the hour. “The theme emphasizes the need for all players to find ways to navigate the macro, legal, and policy bottlenecks. This speaks to the need for innovation. It speaks to the need for creativity. And it speaks to the need for effective leadership at every point in the value chain. This is because leaders are supposed to make progress despite challenges. Leaders are supposed to navigate the complexities of situations to make progress,” he added.

Aware of the cost of funding and its impact on lending rate, which is a reflection of the broader economic reality, the Minister expressed confidence in the ability and willingness of President Bola Ahmed Tinubu to drive economic growth and create a more friendly environment for mortgage banking to thrive in Nigeria. He assured them that the jinx of macro-economic, legislative, and policy issues that have held down the growth of effective housing delivery in the country will be broken under the leadership of President Bola Tinubu.

Speaking earlier, the President of the Mortgage Banking Association of Nigeria (MBAN), Ebilate Mac-Yoroki noted that the retreat provided a platform for deliberation to harness policies and partnerships to create products that would enhance the extension of access to affordable housing finance to a larger segment of the Nigerian populace.

Also speaking at the event were Managing Director and Chief Executive of Nigeria Mortgage Refinance Company (NMRC), Kehinde Ogundimu, who observed that despite efforts by mortgage bankers in the past years, the industry has performed below expectation. “We must find ways to make affordable housing delivery work, starting with lowering the cost of lending. There’s nowhere in the world that mortgage thrives with double-digit interest rates,” he said.

Other attendees include the Managing Director and Chief Executive of the Federal Mortgage Bank of Nigeria, Madu Hamman, the leadership of Family Homes Fund Limited, the leadership of the Real Estate Developers Association of Nigeria (REDAN), heads of mortgage banks and institutions, and representatives of regulatory bodies.