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“Housing for all in the year 2000”.  This was the slogan introduced by General Babangida’s government in which they professed that by the 2000 there will be adequate housing available for every Nigeria. It was indeed a laudable objective considering that Nigerians were (and are still) grossly under-housed.

It was a programme that was meant to ease the housing problems of the Nigeria population by the year 2000 that magical year that began to hold some kind of Arabian nights fascination.  It was generally assumed that in the year 2000 Nigeria would be a dreamland where everything would work i.e. electricity, water supply, roads, education etc.

What really went wrong, we might be forced to ask? It will be indeed a worthwhile exercise to look back in retrospect and proffer possible reasons why this laudable plan in terms of housing was not met by the government.  The answers will help in planning for the future.

The first possible reason, was the poor articulation of the goal of achieving housing for all in the year 2000?  It must be said that no where in the world has the government been able to house 100% of its citizens. It is done in conjunction with the private sector with well-laid out action plans.  No government in the world can house its citizens 100% because of the huge strain it will pose to its resources.

Following on the heels of improper articulation of the objection was the lack of focus.  Where exactly did the government want to house? Was it to be low-income group, the middle income, the upper middle income or the high-income group? As at today nobody can be precise as to the answer to that question.  The government could never have succeeded in housing everybody from the low-income group to the high-income group.

Thirdly, there were no clear policies for its achievement as well as the necessary legislation to back up same. There were legislations like the Mortgage Finance Decree No. 53, National Housing Fund, etc. They were never fully implemented and where they were, it was poorly done.

As the country moves into the new millennium, there are a number of issues that must be tackled to make the housing of the masses on easy one.

To start with and most critical of all is the need for the government to fund a proper census of the various types of accommodation currently available nationwide.  Following this, a population census should also be undertaken with a proper stratification of the various age groups and their numbers.  With these in hand, it will then be simple to undertake a property analysis of the housing needs of the populace.  How many school leaves do we have?  What kind of accommodation is needed for them? The logic there is that a fresh school leaver is out to start life and so may only need a flatlet or one bedroom flat.  It also follows that when the 25 – 35 years age bracket is taken, this is the age where most people are getting married and as such at this period of their life, they would be requiring 2 – 3 bedroom flats.

With these statistics, the government and other property developers will be able to plan developments vis-à-vis what is available and what is needed.  Projection even for the housing needs of the future will then be easy to forecast.

Following this, the various state governments can initiate housing developments projects in their respective local governments within their states.  This option is most advisable for states where housing accommodation is most acute i.e., Lagos, Rivers, etc. In each of these local governments, 500 – 1000 units of accommodation, 2  – 3 bedroom flats, 3,4,5 bedroom detached houses will be constructed depending of course on the results of census and what is needed to satisfy the present accommodation needs. These estates will be provided with all the basic infrastructural facilities to make them habitable including security.  The road upgraded or rehabilitated to ensure that access and exit is not hindered by excessive traffic hold-ups, which in itself could serve as a disincentive to the effective occupation of the estates.

To ensure that the housing developments are within the reach of the masses, pricing is very important.  Housing being one of the basic needs of man, government should not see investments in this sector from the profit motive only.  Governments should view the returns more from the positive social impact of the developments.  Assuming that indeed housing estates comprising 1000 units of mixed developments are undertaken in a certain local government area, the impact of on the life of the precinct would be tremendous.  Apart from the fact that a new catchment area would have opened up, subsidiary and support activities will be introduced.  Plumbers, welders, mechanics, artisans of all trades will spring up to provide support services to the residents of the estate.  In doing this, employment is generated, income taxes will be paid, tenement and ground rents will be collected resulting in increased revenue to the various authorities.

Pricing must be very realistic and competitive taking into consideration the income levels of the proposed occupiers of these development.

It must be pointed out that what helps and drives real estate development and marketing in any country is a dynamic mortgage financing industry.  In Nigeria today, there is really not a mortgage finance industry.  Where they exist, their effect has been minimally felt with the few remaining mortgage institutions undertaking almost purely   commercial    banking    activities. This unfortunate situation has been aggravated by the fact that financial institutions operating in Nigeria do not have access to long term funds.  Recently, statistics of the United Bank of Africa Plc one of the biggest financial institutions in the country indicated that of its loanable funds less than 5% of it was available beyond 12 months. Most of the funds were liabilities that had 30, 60 and 90 day maturity periods.  Property investments have a payback period of sometimes up to 15 years and so matching these funds with real estate developments will be impossible.

Despite  the  collapse   of  the  mortgage    banks  in the  mid  90’s  efforts  must  be to re-introduce a vibrant system no matter how crude whereby housing acquisition can be eased for prospective purchasers as obtains in the developed countries.  In fact, a dynamic mortgage industry is one of the major keys for successfully housing the masses in the year 2000 and beyond.

Despite  the  collapse   of  the  mortgage    banks  in the  mid  90’s  efforts  must  be made    to   re-introduce a   vibrant    system   no   matter how   crude    whereby housing   acquisition    can   be  eased   for  prospective   purchasers  as obtains   in the  developed    countries.    In fact,  a dynamic    mortgage    industry  is one  of the major  keys for successfully housing  the  masses in the year  2000 and  beyond.

There  is no  where   in  the  world   where   housing   of  the   citizenry   is the  sole responsibility of the  government. Private  developers  are always  involved   and this being  the  case  in Nigeria,  they  should  be  encouraged. There are  many ways   to   achieve     this  by   removing    impediments   and   bottlenecks to   the entrance   of these  investors into  this sector.

The Land  Use Decree   should  be  reviewed   to  make  it in consonance   with  the times.   Unless this  decree   is reviewed   the  access  to land  by both  government and  private  developers  would   continue   to be  highly  hampered.

For example    Section   29 states  that  when   land   is acquired    compensation is paid   only  for  cash   crops   n  the  land   and   if there   is a  structure(s)  then   the compensation to   be paid is  calculated based on    the depreciated replacement   cost  of such  a structure.    No compensation   is paid  for  the  land because Section    1  of   the   decree has   ostensibly    vested all   the   land nationwide    in   the   governments. This  in   itself   is  unfair    because most communities  whose  lands  are acquired    have  owned   those  lands  for decades and the  land  itself  has become    of  their  greatest   assets.   It therefore   follows that any attempt    to divest  them  of this land  without   adequate    compensation can only spell trouble.

Coupled with this is the bureaucratic bottleneck and untimely delay in paying compensation for acquired lands, which can take anything from one year to forever.

The lopsided nature of these legislation in favour of the tenants and mortgagors has become a serious disincentive to investment in real estate by private developers.  A large number of Nigerians own properties in Europe and the United States, and we are very aware that it is unlikely that a tenant can live in any property without meeting his rental obligation without being evicted from such a property.  In Nigeria it is indeed possible for periods upwards of 5 years, and unfortunately this will be done with the full cover of the law.  Landlords are not properly protected by this legislation.

In the case of mortgages, we are also all familiar with the endless litigation which mortgagors engage mortgagees in when the latter forecloses on a real estate that has been used to secure a facility which goes bad or becomes non-performing.  This is despite the fact that the mortgagee will have a registered and legal interest (mortgage) over the asset.  With the connivance of the law, injunctions, endless motions are brought to the courts of law all in a bid to frustrate the financial institutions from realizing its money.

The result of all this is that the banks are not willing to finance real estate transactions nor use real estate to collaterise facilities.  They would rather settle for more easily realizable securities i.e. stocks, fixed deposits etc. All these invariable end up acting as a disincentive to private developers, who pay a laudable role in housing the citizens.

Encouragement to private developers by governments could also come by way  of tax  breaks.  or concessions for example   the  State  could   come   up with legislation   that   if a  developer    can   show  that  he  has  spent  W200.000.000.00 within  a certain   period   then  certain   tax  concessions  are  available    to  him  as an incentive.

Again, the government should ease the access to land for private developers.   Theoretically.  the  process  to acquire   land  for development   is by way   of  an  application    to  the  Governor.    who   will  then   process   same   and allocate   a plot  of land  where  it is desired  or where  available.    On paper.   it is a straightforward  easy  process  but  in reality  it is a nightmare    that  could   last ad infinitum.

The procedure   for land  allocation   by  the  government   to  private   developers and   individuals  should   be  seriously  reviewed    with   a  view   to  easing   land acquisition.

Also to  be  eased   are  the  huge  cost  fees  and   levies,  which   the  government charges   developers  on  real  estate   transactions.   For example    in Lagos  State where   a  transaction  is concluded,   to  obtain   the  governors  consent   to  the sale an individual  has to undergo   a long  process  of inspections etc.   where  all kinds of levies and fees are paid; consent fees, capital gains tax development levies, stamp duties etc.  These governments have indeed discovered that this is a money yielding venture and have hung on tenaciously to this process especially in states where land values are quite high, despite the disservice this plays to property development.

What  currently   obtains   in  most  developments   is that   the  focus  is on  luxury developments   to be  completed   and  sold  at  high  prices  far  out  of the  reach of the greater   proportion  of the  masses.  Subsequently, these  same  properties are  let  out  by  the  owners   at  exorbitant   rents  to  enable    them   recover   the purchase   prices.

It is an  opinion   that  government   should   focus  intensely   on  the  provision   of housing  for  the  low  and  middle   income   groups.    The impact    of  government would   be  felt  greater   at  this level,  whilst  the  luxury  developments   could   be left to the  private  developers,  or government  acting   jointly  with  them.

Finally  it must  be  agreed    that  the  economic   base  of  the  nation   is still very narrow.     Housing   provision   is capital    intensive   and   the   governments   with several   other   priority   projects    in  view   can   only   allocate so  much    of   its resources to housing development.  This implies that foreign investment into this sector must be encouraged. The only way that foreign investment can come  in is by providing   the  enabling   environment.   This enabling environment will  include   a  stable   polity,  provision   of infrastructural  facilities   i.e.  electricity, water,    road    etc,   safe   and    secure    environment, as well as stable and consistent government  policies.

With  these  in place   investors  would   have   no  fears  about   bringing   their  hard earned   income   into our economy    for good   returns.

In conclusion   it can   be  very  easily  discerned   that  the  challenges    of  housing the  citizens  in the  new  millennium   is indeed   a huge  one.   The process  should not be one that lip services is paid to. It must be a planned process that will survive from administration to administration if any level of success will be achieved.  The foregoing issues raised though not exhaustive will help a great deal if well implemented towards achieving these laudable objectives and making our society an easier on in which to live.

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