Paying rent for a decent home is a major challenge for low income earners. In a bid to facilitate housing delivery, especially for the low and medium-income earners, Dr Victor Onukwugha, the President of the Association of Housing Corporation of Nigeria (AHCN), has solicited the creation of a new ‘Housing Development Fund’ to grant social loans to housing corporations to engage in property development that will be allocated to National Housing Fund (NHF)’s contributors.
He made the admonition during a two-day National Workshop on Facilitating Affordable Housing for Medium and Low-Income Earners in Abuja, Onukwugha said there was an urgent need to sanitise the primary mortgage market with enabling laws.
He blamed inadequate financial support in terms of seed funding and the high cost of funds for challenges confronting the nation’s housing corporations.
Onukwugha called for the provision of government guarantee with credit insurance for lenders to mitigate and share risk.
He said there should be provision of a credible national credit database to assist financial institutions in information sharing, assessment and rating in property financing and mortgage origination.
He also appealed to the government via the Central Bank of Nigeria (CBN) to regulate interest rates to a single-digit for housing financing; while making a case for the provision of quick resolution of foreclosures parameters to attract investors to the sector.
To facilitate low and medium income housing, the AHCN boss said the controlling body of cooperative societies in each of the states should work in partnership with the state housing corporations to develop affordable dwelling units for viable societies in all states of the federation.
“The state controlling body of cooperative should serve as the guarantor for the housing corporation to get an exit point. Provide tax incentive/rebate for manufacturers of local building materials to encourage adequate production of such materials at affordable prices to flood the market,” Onukwugha said.
He called for the commitment of the government to the provision of infrastructure such as roads, water and electricity as a subsidy package to reduce cost of housing units.
He also urged the government to inject at least N500billion intervention funds at single digit interest into the housing sector.
The AHCN boss called for digitalisation of land registries and reduction of cost of registering property
He is of the opinion that there should be provisions for the diversion of certain percentage of excess funds in the coffers of Pension funds and insurance companies into housing provision, saying there should be activation of vibrant secondary market and alternative funding sources.
On what is required for the transformation for effective housing delivery, Onukwugha stated that usurpation of the statutory responsibilities of state housing agencies by the state ministries should not be allowed “as it will create room for politicking with projects.”
He urged the Ministry of Housing to strictly reduce its activities to policy formulation and monitor her statutory parastatals to ensure policy compliance and accomplishment
“There is no doubt that provision of low and medium income housing has suffered great neglect in recent time which was further compounded by the effect of COVID-19 that paralysed global economy, it is however pertinent to recognise that housing sector still possesses the most viable platform to rescue the nation from economic woes and recession if approached pragmatically.
“The involvement of state housing corporations is definitely inevitable if we hope to facilitate low and medium income housing for Nigerians through social housing platforms as enumerated in the National Housing Policy.”
“Moreover, if the Economic Sustainable Plan hopes to achieve its lofty objectives of creating jobs for the people and contribute to GDP and economic development, Housing Corporation remains the key to unlock this potential of economic recovery through ESP,” he said.