Sunday, January 10, 2016

Bridging the 17 million Nigeria housing deficit

Government will lead the aggressive intervention to increase supply, by undertaking construction of public housing and formulate policies that will invariably lead to private sector participation and ownership to reduce our housing deficit. – Minister of Power, Works and Housing, Babatunde Raji Fasola (SAN) in his inaugural ministerial press briefing on December 8, 2015.

According to the renowned American Psychologist, Abraham Harold Maslow in his hierarchy of needs theory, there are some basic physiological needs of human beings. Of these, three are basic. They are food, shelter and clothing.  In Nigeria, there is an estimated 17 million housing deficits. It must be stated that most of the shortages are in the urban centres. Little wonder some Nigerians live under bridges and some ramshackle makeshift contraptions just to shield them from the inclement weather and protect them from potential dangers. It is the dream of many Nigerians to cease being tenants and own their homes. While some realise this lifelong ambition, many do not.

The challenges of owing private homes in Nigeria are many. The first major one is land acquisition. Land Use Act of 1978 in section 1 says: “Subject to the provisions of this Act, all land comprised in the territory of each State in the Federation are hereby vested in the Governor of that State and such land shall be held in trust and administered for the use and common benefit of all Nigerians in accordance with the provisions of this Act.” Vesting land proprietary in governors or government and making it as part of our Constitution have been viewed as a great impediment to availability and affordability of houses to Nigerians.

According to Vanguard of August 6, 2013, some of the experts have this to say about access to land in Nigeria.  An Estate Surveyor and Valuer, Mr. Stephen Jagun was quoted as saying that “there would be no meaningful growth in the real sector if land continues to be under the firm grips of state governors.” According to him, “Land has become so expensive because unlike what used to obtain, you could buy a piece of land from either the community, an individual or from even a company and you go and register that title at the Land Registry. Once it is registered, it becomes a bankable document. Today, it is not so; you go and pay the usual fee and you take the document that they give to you and the survey plan to the government who will then issue you a certificate of occupancy, C of O.”  He went further: “At the end of it all, it is just double payment, and the C of O is a document that one waits ages for. The whole process has failed. The Military which promulgated the Land Use Decree said the reason they did so was to make land accessible to more Nigerians than before. But from our own experience, the reverse has been the case.”

The Chairman of the Lagos State chapter of the Nigerian Institute of Quantity Surveyors, NIQS, Mr. Olayemi Shonubi however was of the opinion  that whether the Land Use Act remains in the Constitution or not, what is important is that land should be easily accessible to those who are genuinely interested in investing in housing production. The newspaper quoted him as saying that “Beyond the legalistic issue of how long it takes to amend an Act that is part of the Constitution, most states particularly Lagos, Ogun, Rivers and FCT Abuja are charging outrageous amounts of money as consent fees and transfer of mortgages because they view land as their own black gold and a resource they must maximise to boost their internally generated revenues.”

That apart, there is also the contentious issue of quackery in procurement of land titles. Many unscrupulous elements in government’s Ministry of Lands and Housing and their outside collaborators issue fake land title deeds to unsuspecting members of the public. This has caused a lot of tension and litigations on many acquired lands. Beyond government and its officials, there are also a lot of sharp practices and malpractices on the part of traditional land owners popularly called ‘Omo Onile’ among the Yorubas. They sell same plot of land to several persons. This is very rampant in South West Nigeria, especially in Lagos where land acquisition is at a high premium. Many have been killed, maimed and duped over land matters. Even when one acquires land genuinely, some of these land grabbers and touts ask for huge sums before any structure can be erected on a land that has been properly acquired.

Another potent problem with building personal house in Nigeria is the prohibitive cost of building materials. The cost of cement, sand, granite, planks, iron rods, locks, nails, roofing sheets, ceiling materials, paints, tiles, and other sundry items have compounded challenges of home ownership in Nigeria. Many who manage to build houses in this country have had to take cooperative or bank loans at high interest rate to do so.

This is the more reason why government intervention in the housing scheme is desirable. Unfortunately, our mortgage finance system is still fraught with a lot of challenges. The National Housing Fund, the Federal Mortgage Bank, the National Housing Policy, the Federal Housing Authority are all in need of reforms to make them perform optimally. In the past, many federal and state housing schemes have been abandoned. I recall that the government of former President Shehu Shagari made mass housing one of its cardinal electoral promises. They were never completed in many states. In Oyo State, the Ajoda New Town Housing scheme was similarly abandoned by the State Government.

Well, it needs be stated that private property developers have been trying to fill the gap by building mass housing and shopping malls all over the major urban centres. However, due to the aforementioned challenges, the cost of acquiring property from these private sector businessmen is very prohibitive as they are not charity organisation. They have to recoup their investment with a margin of profit.  At the end of the day, there are many houses that are unoccupied in city like Abuja because the cost of rent, lease or acquisition is not pocket friendly. 

This is why the government has to intervene in the provision of affordable mass housing schemes. In his maiden media chat, the Honourable Minister of Power, Works and Housing, Babatunde Raji Fasola, SAN made a commitment to do the following: Complete on-going Federal Housing projects; get land from the Governors in all states and the FCT to start 40 Blocks of Housing in each state and FCT as well as consider the re-design of existing housing roof types to make them ready to receive solar panels for electricity without damaging the roof or cause leakage during installation.

 According to the minister “We expect State Governors to play a critical role here, by providing land of between 5-10 hectares for a start, with title documents, and access roads or in lieu of access roads, a commitment that they will build the access roads by the time the houses are completed. We see this leading to potential delivery of 12 flats (homes) per block and 480 Flats (homes) per state, and 17,760 Flats (Homes) nationwide, for a start.” He cited his experience in Lagos where on every one hectare of land it is possible to build 8-10 blocks of houses which will generate at least one thousand employments.

One major worry expressed by the minister is sustainability. In his words, “But we must be clear that sustainability is critical to solving the (housing) problem. One component of sustainability is that we must be able to repeat what we do, which means that we must recover the cost of houses, even if there is no profit, so that we can build more.” Sound logic!

To assist government to bridge the gap of housing deficit, information at my disposal shows that Lafarge Africa Plc has come up with a solution called the Aluminum Shuttering. According to the world's largest building materials manufacturer, this technology will produce lots of houses at an increased speed and reduced cost.  Using this new building technology, Lafarge reportedly commissioned a prototype Studio Apartment in Lagos state. This apartment was allegedly constructed within 12 days. It has one room, toilet with bathroom, a kitchen and cost N1.5 million. This is a commendable initiative which federal government should study and adopt if found to be genuinely cost effective, durable and safe.

Jide is Executive Director of OJA Development Consult, Abuja. Follow me on twitter @jideojong