Apparently worried by increasing accommodation challenges among Nigerians, some concerned affordable housing advocates have mulled fresh ideas to deliver four million houses in four years.
Throwing themselves in for the housing challenge and solution, they sought from the Federal Government an Executive Order or legislation backing them to build special estates across Nigeria.
Challenging the status quo on the Affordable Housing Development Advocacy Group’s platform, Principal Partner at Novone Consult Limited, Mr. Ezekiel Nya Etuk, an architect, demanded that the authority should allow them take charge of the housing ministry for four years to deliver the four million housing mandate.
“Give us the Ministry of Housing to ‘run’ for four years. Don’t pay a dime, not even for my ‘aides’. Approve Presidential Executive Order, or better still, legislation for special estates. In return, we will deliver four million homes in four years in the first instance,” he said.
On how to achieve this, he explained that his team of professionals would set up a consortium of select stakeholders in the industry, adding that based on a special legislation, it would deliver the said mandate with no cost to government, yet with handsome profit.
On what he needed legislation for, he stated that the legal backing would enable the team to build special estates.
The main aim of the whole concept, according to Nya-Etuk, was to address the issue of lump sum deposit for houses, which he said would never work in the country on a scale that would make appreciable impact in addressing our humongous housing deficit.
He stated that unless there was a decisive policy that compels people not to default on their mortgages and hope to get away with it, investing in mass housing would remain ‘talk’ as “no one will deploy his/her often high interest borrowed funds, or even hard earned resources only for another to get comfort in endless court foreclosure frustration.”
According to him, the estates would be run as rental apartment, adding that payment would be on monthly basis.
He said: “Any defaulter will be given only two weeks of grace to make good his monthly commitment, or be evicted with no option of legal gymnastics.
“The estate police move the defaulter’s property in the apartment into a warehouse for a maximum period of 30 days and thereafter auction them and deposits whatever is the proceeds in the tenant’s submitted account.”
Going by the above measures, Nya-Etuk is of the opinion that with the enormous market potential, investors, who would be assured of their proceeds, would flood the ministry.
On land acquisition for the project, he said the team would partner state government to deliver the house.
He said: “I have been involved severally in getting lands from government. What is responsible for the seeming present reluctance of state governments to give out more lands is the understandable frustration of governors that keep giving choice lands to the Federal Government without seeing the houses.
“With this arrangement, and with the state governments as strategic partners, we will be wondering what to do with lands as the workers will be the direct fire on any governor that decides to prove difficult. The ministry staff will be fully utilized and will enjoy enhanced pay.”
Nigeria has 17 million units housing shortfall,and would need to build one million houses yearly for next 20 years to bridge the deficit. Currently the nation is building less than 100,000 housing units annually.
Managing Director, Ace Hi-Teck Construction Company Limited, Adewunmi Okupe, corroborated Nya Etuk, saying the nation needed peculiar solutions to housing challenge, calling for inclusion of cooperative funding.
Cooperative funding, he said could be revolved for as long as desired.
Such funds, he said, could take care of long term lending at even six per cent per annum because they came in at near zero percent.
Okupe said: “Providing access to one million up-takers every year consecutively for four years is not as tall an order as you imagine. It is very doable if we shift our focus away from conventional efforts that have failed us repeatedly over the years.”
However, another affordable housing advocate, Ali Magashi, picked hole in the entire model, saying “the rule of thumb said it typically took an average of 20 years for rental payments to pay for the cost of land, infrastructure, development and finance”, noting that there was no construction finance that exceeded five years.
He said: “So there’s a mismatch in the proposal. Only institutional funds (pension, insurance and life funds) can wait for such gestation period, and unfortunately, institutional funds don’t invest in housing development because of the attendant default, construction and investment risks; they typically invest in debt securities, preferably collateralized debt securities (mortgage backed securities and mortgage bonds).”