Addressing The Nigerian Housing Deficits Through Real Estate Foreign Direct Investments (FDIs)

 ESV Olujimi Ayoola Kalejaiye

In the midst of the Nigerian housing deficits, which is arguably one of the social-economic problems facing Nigeria today, one of the ways to address this challenge is huge Foreign Direct Investment (FDI) in the Nigerian real estate sector.  According to the Federal Mortgage Bank of Nigeria (FMB), the Nigerian housing deficit is currently at 28 million units as of January, 2023. With this disturbing statistics, it is obvious that the government alone cannot close the deficit gap.

In addressing the Nigerian housing deficits, the federal government should come up with macroeconomic policies aimed at attracting Foreign Direct Investment (FDI) in the real estate sector. The new government of President Bola Ahmed Tinubu should as a matter of urgency come up with policy directions that will allow massive FDIs in the real estate sector in Nigeria. This will be a silver bullet approach in addressing the acute housing shortage in Nigeria.

By a way of simple definition, FDI is the investment made by a foreign corporate entity or government in another country.  They are lasting legal investment made by a government or a firm into a foreign country.  In this scenario, real estate Foreign Direct Investments (FDIs) are real estate investments made by a business entity or government   into another country.

In the case of the Nigerian real estate sector, FDIs have so many benefits that will help in addressing the Nigerian housing deficits. Besides the massive development of housing units that will help in accommodating the fast growing population, foreign expertise will be deployed in the real estate ecosystem in Nigeria.

Quality housing and smart cities that are in line with the international standard will be made available for Nigerians at very affordable rates. Quality and affordable housing will entrench quality living and overall welfare of the Nigerian populace.

The Federal Government should partner with global top-contributors to Foreign Direct Investment (FDI) like the United State of America and China. When the investments of these World economic powers are deployed, it will change the landscape of the Nigerian real estate space.  These countries are already operating massively in the Nigerian economy but their investment footprints should be expanded with a special focus in the real estate sector with the aim of addressing the Nigerian housing crisis.

FDI in the real estate sector will attract more jobs in the sector; create a competitive environment for quality housing delivery. Taxes will be paid to the government at all levels, and revenues would be generated for the overall economic growth and development.

In all these, the government has a pivotal role to play. Besides the development of policy road maps to attract Foreign Direct Investment in the real estate sector, the needed macroeconomic environment for the businesses to thrive should be created and maintained. Price regulatory policies should be in place, where otherwise, the aim of the housing policy would be defeated.

ESV Olujimi Ayoola Kalejaiye is a Registered Estate Surveyor and Valuer, and the Team Lead at Jimi Kalejaiye + Associates, a registered Firm of Estate Surveyors and Valuers