MASS HOUSING DELIVERY IS NEEDED TO TACKLE THE NIGERIAN HOUSING DEFICIT

ESV Rasheed Tarfa Yusuf

Recent figures indicate that the Nigerian housing deficit is put at 28 million units as at January, 2023.  This statistics, no doubt, is worrisome, and one of the highest in the World.  In Nigeria, governments’ past policies aimed at addressing housing delivery have failed to yield the needed results of addressing the acute shortage of housing that is plaguing Nigeria as a developing economy. The past policies have failed due to a number of reasons; chiefly among them are massive corruption and inconsistency in government housing policies. With so many past government policies, many Nigerians cannot still afford decent and cheap homes, which is a pointer to the fact that the past government spending did not speak to the housing needs of Nigerians, especially the low income earners. This development, by extension, has reduced the standard of living of so many Nigerians, especially the urban and rural poor that can be described as Economically Displaced People or Population (EDP).

With a growing population over 200 million people, and with the government advocacy drive to attract foreign investors, Nigeria must invest heavily in the housing and real estate sector as a whole to close the housing deficit of the country.

According to a World Bank report, Nigeria would require N59 trillion investments to close the housing deficit. To bridge the housing gaps, the Nigerian government at all levels should work towards creating the congenial environment for businesses to thrive. The N59, trillion investments to bridge the Nigerian housing deficit as forecast by the World Bank cannot be weathered by the government alone.  There is a need for massive housing investment from the private sector, multinational organizations by way of Foreign Direct Investments (FDIs). Also, multilateral financial institutions like the World Bank, African Development Bank (AfDB) have pivotal roles to play in this regard.

There is a need for greater investments and collaborations between the Nigerian real estate space and the Nigerian development institutions like the Federal Mortgage Bank (FMB), Development Bank of Nigeria (DBN),  Bank of Industry (BOI), amongst others.  Strong partnership with these institutions will engender the needed real estate sectoral fund for housing development in Nigeria.

Nigeria has a poor 25 percent home ownership rate. This is by far lower than that of its counterparts in other emerging markets or Less Developed Countries (LDCs). This, according to experts, is due to difficulties in acquiring an affordable mortgage as occasioned by lack of investment in the sector.

The onus is majorly on the government to create the needed macroeconomic environment that will gender real estate investments at a rate that will encourage home ownership from the low income earners in Nigeria.

In addition to the existing mortgage institutions, there is a need for more mortgage institutions to be floated that are tailor-made for the real estate sector with a particular focus on housing development facility financing.  

The task before all stakeholders in the Nigerian built environment is for us to create the necessary framework and the needed environment that will allow massive and coordinated investments in the housing sector.