‘More funding for housing sector ’ll stimulate economy’

Financing Nigeria’s housing deficit, estimated at
between 17 to 18 million units would help to
stimulate the economy, experts have said.
Stakeholders in the industry insist that with the
economy slipping into recession in the second
quarter, providing funding to bridge the housing
deficit would help to create jobs, deepen economic
development and ensure speedy economic recovery.
Managing Director/CEO, Brent Mortgage Bank Limited,
Kola Abdul, said housing provision requires huge
capital outlay, which is often beyond the capacity of
the medium income/low income groups, hence the
need for adequate funding for the sector.
He spoke at the launch of new mortgage products
developed by his company, in Lagos.
Adequate housing provision, according to him, has,
over the years, remained one of the three most
important basic needs of mankind–the others being
food and clothing.
Besides, millions of families are living under sub-
optimal conditions and in order to cover this deficit
the government needs to create a housing scheme
that facilitates housing credits for households that
otherwise would not be able to access regular credit
institutions.
Another mortgage banker, Stephens Obi, said bridging
the housing deficit scheme can create over one
million new jobs in the construction sector. He said
states and local government authorities could
participate through financial resources, land
donations, infrastructure, tax reduction and
registration of demand.
He described housing deficit as government’s
inability to house its citizenry in properly fitted
houses with the necessary modern infrastructure for
basic needs like running water, electricity and
sanitary needs. The need to address the shortfall, he
added, remains a good means of stimulating a
country’s economy.
“It stimulates the economy by pushing a lot of money
into circulation. Every recessive economy needs a
stimulus as we can see from around the world; an
injection of cash into the economy in the hands of
spenders. This acts as a stimuli. Money being spent
at all levels at the sametime will move the economics
of buying and spending to revive the economy. This
ability to spend creates the necessary needed
monetary activity in the country. Construction of
houses will initiate growth, which would assist in
creating jobs. The economy is stimulated, which will
translate invariably to Gross Domestic Product (GDP)
growth,” he said.
Continuing, he said creation of jobs in any country is
a very vital function of government. “The issue of job
creation is a tool used to evaluate the health of a
country. Besides, the employment rate is key to
national growth and efforts must be constantly made
to keep the work force constantly employed for nation
building. Construction of houses is the most effective
way of stimulating an economy as it has massive
employment abilities.
“It supports and encourages the local industry by
employing a lot of the low income earners optimally.
It keeps the artisans off the streets and therefore,
assists in keeping a ceiling on majority of the
expected crime from them. This is a good and positive
function of job creation,” he said.
Another mortgage banker, Michael Osondu, said
mortgage financing enhances nation building
initiatives. “Housing should not be left alone to
housing ministries, Ministries of Labour, and
Productivity, Finance and Internal Affairs should join
hands in creating the right atmosphere that will
enhance nation building.
“Provision of affordable homes for millions of families,
and improvement of the standard of living of the
general populace make the housing initiative a win-
win project for both the government and the
populace. Housing is a basic need of life and it
increases demand for services and infrastructure
accompanied by the steadily growing urban
population,” he said.
Other experts said Nigerian cities also face a number
of challenges resulting from the unplanned and
uncontrolled urbanisation process, including a
housing deficit of 17 to 18 million homes. It is a point
of note that of those in need of housing, most are
from low-income families, a demographic that a
government must never overlook.
To provide housing and improve quality of life for
low-income families across the country, a housing
initiative can start partly as a response to the rapid
urbanisation seen over the last few decades.
He said majority of Nigerian population currently live
in cities with the highest rate to urban growth taking
place.
The nation’s goal is to help these low-income
families find stable, affordable housing while
promoting a sense of community.
“Depending on location and context, these houses
can come fitted with sustainable features that benefit
residents, creating the much needed jobs and
therefore stimulating a nation grappling with budget
deficit and recession. With government data shows
that millions of the citizens need low cost home, a
dent in the number of people needing secure homes
will be a step in the right direction for getting the
poor onto the housing ladder, more jobs being
created, and new shoots in the growth of the GDP,”
he said.
“There are threats though to the housing projects;
Accurately counting the number of families who need
them and who gets what they need and applying the
appropriate financial support must be handled by
financial experts as we know how terrible credit can
be in Nigeria. Secondly, most viable plots of land for
social housing projects tend to be in isolated places
with little or poor access to essential public services
and infrastructure – most notably health, education
and transport as there may be high costs associated
with better plots in more accessible areas”.
He also urged government to allocate lands that have
easy or close access to essential public services and
infrastructures.
“All under-utilised spaces and buildings in central
areas of cities can be redesigned to give rise to
affordable housing projects. Cities and the private
sector can and must work together to implement
robust urban projects and provide affordable housing
to those who need it,” he said.
“We must find a common language to establish the
dialogue between governments and the private sector,
as the private sector is the bridge that the
government will use to reach the masses, for any
housing project to have a successful future ahead.
To connect the dots, a proper, fast and efficient
means of transportation should be created for homes
in isolated areas, so families can have easy access to
public services and infrastructures”.