The housing deficit in Nigeria was estimated at 28 million in 2023. And it is believed that the huge deficit is largely driven by the country’s rural-urban migration, which the United Nations Population Migration Division Section put at 76 million as of 2017. It also projected that this would reach 275 million by 2050.

However, with the Vice President, Kashim Shettima, stating that Nigeria requires N21 trillion to bridge the housing gap, the President Bola Tinubu administration has prioritised efforts at reducing the huge deficit and bringing succour to Nigerians.

The Minister of Housing and Urban Development, Ahmed Dangiwa, underscored this renewed commitment to provide Nigerians with shelter when, shortly after his inauguration as minister last August, promised to take initiatives and champion strategic housing reforms that would break systemic barriers to housing and urban development.

Specifically, he said his ministry would embrace innovative housing construction financing solutions while working with relevant institutions to unlock the funding required to deliver massive affordable housing nationwide.

Those were solemn commitments that boded well for millions of Nigerians who have long been yearning for quality and affordable housing, and as it turned out, the Minister was poised to make good his promises, first by working  with the National Assembly to review relevant laws to streamline land and housing administration and create a conducive environment for investment in the housing sector. He also moved to prioritise the N500 billion recapitalisation of the Federal Mortgage Bank of Nigeria (FMBN) to give it leverage and enhance its ability to provide more affordable mortgage loans and rent to own options to Nigerians.

Dangiwa said he would reform the FMBN, the Federal Housing Authority (FHA) and other housing agencies so that they can have the necessary capacity and technological edge to deliver world-class services to Nigerians. To ensure that the strategic agencies are more effective and efficient in delivering at massive scale, decent and quality housing to Nigerians, he stated that unlocking the massive power of the construction industry would help create jobs and contribute its quota towards achieving the President’s plan to grow the economy, boost inclusive growth and lift 100 million Nigerians out of poverty.

Those were not mere promises, unlike in the past. Dangiwa appears determined to walk the talk. He began by collaborating with the National Population Commission (NPC) to ensure an accurate data of Nigeria’s population, which he said, is a pressing data challenge to accurately determining the extent of the housing deficit in the country. He said his administration wants to work to establish accurate, credible, verifiable, and scientifically sound data on the housing deficit and the living conditions of the homes that Nigerians live in nationwide.

According to the Minister, it is only through a comprehensive understanding of the housing deficit that the country can devise effective strategies to addressing the housing shortage. He explained that the collaboration with the NPC, particularly in the context of the next national census, was a critical step in this journey. He said the census is a timely exercise, one that provides the government with an invaluable opportunity to gather precise and comprehensive data on the country’s population’s housing needs.

The objective and expectations, Dangiwa explained, goes beyond merely counting houses but understanding clearly that the housing deficit is not solely about the quantity of structures but also about the quality of living conditions. That means whether the homes that Nigerians live in provide access to good sanitation, proper toilets, sufficient living spaces, a healthy environment, and other essential amenities.

To achieve this, the Ministry collaborated with the Commission to design and implement survey instruments specifically tailored to address housing-related questions. The administration realised that the issue of housing deficit does not only affect Nigerians in the country but Nigerians in Diaspora who wish to invest in the sector within the country. Unfortunately, this need to own houses by Nigerians in the Diaspora has been repeatedly hampered by reports of fraud committed by people they contracted to build them houses within the county.

It was learnt that there are over 20 million Nigerians in the Diaspora with an average remittance of over $24 billion yearly. Dangiwa explained that part of President Tinubu’s Renewed Hope Agenda is also channelled towards Nigerians in the Diaspora interested in investing in the housing and real estate sector through land reforms. The administration, he said, is trying to streamline land administration that cuts through the bureaucratic bottlenecks and systemic inefficiencies to ensure cost-effective and efficient access to land for both individuals and investors in Nigeria.

Currently, Nigeria has a situation where the Land Use Act, enacted in 1978, has no complementary institution set up alongside it to provide the necessary framework, guidelines, and regulations for operationalising it. The administration said it aims to fix this systemic anomaly and is working to establish a National Land Commission, part of whose job would be to outline the implementation guidelines for the Land Use Act to chart a new path of effective land administration in the country.

To address the deficit, the administration said it intends to adopt a nation-wide Model Mortgage Foreclosure Law. The Model Mortgage Foreclosure Law (MMFL) provides contemporary provisions on the creation, registration, and enforcement of mortgages, along with remedies like foreclosure and the enforcement of mortgages on real properties and related purposes in Nigeria. It is also particular about boosting local manufacturing of building materials. The administration said Nigeria’s shortfall in the supply of quality housing stock presents a good opportunity for investors, to drive this.

It aims to create an enabling environment for private sector players to produce building materials locally to lower cost, create jobs, grow the local economy, and ultimately, ensure inclusive growth. To do this, it plans to establish six  manufacturing hubs in each of the six geo-political zones in the country. The hubs will be provided with relevant facilities, including access roads, electricity, fit for purpose housing and relevant linkages for manufacturers to site their firms and operate.

The government would also be proposing relevant incentives that will make it more profitable and rewarding for the private sector to manufacture building materials locally. The Minister said it was in line with this thinking that he developed the Diaspora Housing Mortgage Loan, in collaboration with the Nigerians in Diaspora Commission (NiDCOM), when he was the Managing Director/Chief Executive of the Federal Mortgage Bank of Nigeria (FMBN).

The Mortgage Scheme was designed to enable Nigerians living overseas participate in the National Housing Fund (NHF) Scheme so they can access up to N50 million to own their homes in Nigeria. Participants can access the loan via a National Housing Fund (NHF) loan, Rent-to-Own or the Individual Construction loan window. The terms are affordable, at best market rates.This includes a single-digit interest rate of nine, and a payback period of up to 10 years. As part of the initiative, the FMBN will facilitate the construction of affordable housing units in major cities that meets the specifications of Nigerians in Diaspora.

Housing financing 

The Federal Ministry of Housing and Urban Development has a partnership with the International Finance Corporation (IFC), an organisation that has committed over $128.3 billion in loans, grants, investments, and guarantees to partner countries and private businesses. In Sub-Saharan Africa alone, IFC has committed over $38.6 billion.

Believing that Nigeria is yet to derive maximum benefits from its partnership with IFC, Dangiwa said as a new government with new priorities, their aim is to enhance and expand the partnership between the IFC and the Ministry to deliver value to Nigerians. He listed his action plan for Nigeria’s housing sector as “Strengthening the institutional capacity of federal housing agencies, including the FMBN and Federal Housing Authority (FHA).

He said: “Increasing the supply of decent and affordable housing stock.  Establishing a national social housing fund (NSHF); implementing land reforms to streamline land administration and ensuring easy access to land for Nigerians and private sector players; setting up building materials manufacturing hubs; implementing urban renewal and slum upgrading programmes; and developing new cities that are integrated, inclusive, and demand-driven.”

Dangiwa emphasised: “We intend to ensure that these reform initiatives are grounded in sound industry knowledge, expertise, and wisdom of professionals and stakeholders, enabling them to succeed on a sustainable basis.” He said the government recognises that the most significant challenge in affordable housing is the cost of finance. Interest rates on bonds are in the double digits, and raising international funding for housing projects remains challenging due to fluctuations in the foreign exchange rates.

As budgetary financing for housing development is inadequate to meet the demand, the Ministry explained that the most accessible sources of single-digit finance for housing construction are the FMBN through the NHF Scheme and the housing construction windows of the Family Homes Funds (FHFL). However, the resources pooled by FMBN through NHF and FHFL, through government injections and partnerships are still grossly inadequate to provide the volume of housing required.

Dangiwa added: “It is imperative that for our nation to deliver the necessary quantum of housing units that Nigerians need at prices they can afford, we must find innovative ways to unlock housing finance while encouraging private sector investment in the housing sector. As a Ministry and in alignment with the vision and direction of President Tinubu, we are dedicated to creating a conducive environment that fosters increased private sector investment in housing.”

Continuing, Dangiwa said: “Our objective is to break all institutional, legal, and bureaucratic barriers that have hindered sector growth over the years. This includes collaborating with key stakeholders to review and amend the Land Use Act to streamline land administration and make access to land easy and fast. We hope that by doing so, we can unlock the estimated dead capital estimated by PricewaterhouseCoopers at over $300 billion.

“Additionally, we are diligently working to reform the key agencies under the ministry’s supervision, the FMBN and the FHA. Strengthening these institutions will enhance their financial capacity to provide affordable housing finance.”

Housing for all

The administration insists that its goal is to reduce the deficit it met in housing to the barest minimum through a reform agenda that has many components. The Minister explained that these reforms range from slum/urban upgrading since not all Nigerians can afford the mortgages that the FMBN offers at single digit interest.

He stressed the need to support Nigerians who can afford to own a home via mortgages from the FMBN, FHA and even commercial mortgages, by empowering and supporting the efforts of agencies towards meeting this need.

On top of the list is the Renewed Hope Cities and Estates that the government seeks to deliver in phases. Phase one of the project aims to deliver 34,500 housing units ranging from 1,000 housing units per site in one location in each of the six geo-political zones of the country and FCT. These are Abuja, Lagos, Kano, Borno, Nasarawa, Rivers, and Enugu are locations.

Dangiwa assured Nigerians that the remaining states would not be left out because Renewed Hope Estates of 500 housing units per site would be constructed in each of the remaining 30 states. The slum upgrade would also take place in phases, as the Ministry plans to uplift 26 sites nationwide. This includes four sites in each of the six regions of the country totaling 24 and two in the FCT.

Key services to be provided at the identified sites will include water supply, solar streetlights, rehabilitation of access roads, construction of drainages and waste management and sanitation services.

Source: The Nation