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Payment default: Developers may embrace rent-to-own scheme

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Apparently buoyed by the success recorded so far under Lagos’ rentto- own housing policy, developers, the Federal Government and states have been implored to tinker with the idea. Dayo Ayeyemi writes

When the Lagos State Government disclosed plans to begin the rent-toown policy in order to enhance homeownership, many doubted the sincerity of the government, considering its numerous empty houses with high price tags.

However, the policy, which has produced 500 new homeowners in the last three months, is gradually becoming the cynosure of all eyes as real estate developers are considering the option.

Highly motivated that the scheme works in Lagos State, President of Real Estate Developers’ Association of Nigeria (REDAN), Mr. Ugochukwu Chime, a surveyor, has tasked private developers, federal and state governments on to tap into opportunities inherent in rentto- own to reduce the 17 million accommodation shortfall in the country.

According to him, rent-toown option will reduce default in mortgage payment if fully embraced by developers.

Speaking with New Telegraph by telephone, Chime appealed to private developers to embrace the Lagos example.

He advised them not to jettison any option that would guarantee sales of housing units in their estates.

“Federal, states and private developers should emulate Lagos state government,” the REDAN boss said.

Lauding Lagos authorities for the initiative, he explained that provision of construction finance and mortgage for subscribers would reduce fraud in the country.

Rent-to-Own is a kind of sales contract that enables a buyer to rent-to-own the property they wish to buy.

Typically, a buyer will rent a property until it is paid in full, and then the deed transfers from the seller to the buyer.

Inherent opportunities

Chime pointed out that in rent-to-own, title (Certificate of Occupancy) of the property would not be given to the prospective buyer until he or she completes the payment.

He described the scheme as a way of guaranteeing default in payment. According to him, the equity contribution is low compared to classical mortgage, which is the range between 20 to 30 per cent.

“In rent-to-own policy, rent has covered equity fund to own a home,” Chime said.

Lagos’ allottees

In the Lagos example, tenants turned landlords in the state have had cause to commend the scheme as their dreams of owning their own houses were made easier through the Lagos State Government initiative.

A beneficiary and civil servant in the state, For Mr. Musa Olugbenga, overwhelmed with joy, said: “ I am now a proud owner of a two-bedroom flat in Chois Estate, Agbowa.”

He narrated how he applied for the scheme and was asked to deposit five per cent of the housing cost.

According to him, the house costs N3.5 million and I paid N176,000 as equity and other charges for insurance and facilities to qualify for the scheme.

“In all, I paid almost N280,000,” he said.

Another beneficiary Mr.Kazeem Olajide, said he never believed the government when the policy was announced, but “my wife encouraged me.”

While commending the state government, he said: “The five per cent commitment fee to qualify for the house is unbeatable.”

Also, Mrs Olowo Oludotun, a civil servant, who said she would be retiring soon, said the rent-to-own policy of the state government had provided her unique opportunity to become home owner.

“I will have a place to lay my head at last,” she exclaimed. Handing over keys to third set of allottees under the housing policy, Commissioner for Housing , Mr. Gbolahan Lawal, hinted that 10 private real estate developers had been engaged on public-private-partnership (PPP) basis in order to increase housing stock in the state and Nigeria in general.

With 500 homes already allocated, Lawal said it was estimated that housing would have been provided for not less than 2,500 people taking an average of five persons per family.

The commissioner said that houses were allocated from Sir Micheal Otedola, Odoragunshin, Epe; Chois Gardens, Agbowa; Oba Adeboruwa, Igbogbo-Ikorodu; Hon. Olaita  Mustapha and Alhaja Adetoun Mustapha,Ojokoro.

He said that more schemes were coming up. He disclosed that apart from 4,445 housing units already available for the policy, additional 3,315 units would be added to housing stock soon.

Recalling the commencement of the initiative, Principal Partner, Stephen Jagun and Co., Mr. Stephen Jagun, said he was present when former governor Babatunde Fashola, first hinted about the programme.

“He informed the gathering that they saved enough fund to make the programme revolving and self-sustaining,” Jagun said.

He noted that Governor Akinwunmi Ambode had introduced some modifications to the scheme, urging the need to make the plan more impactful.

Jagun, who is an estate surveyor, valuer and facilities manager, urged Fashola to introduce rent-to-own policy at federal level.

He said: “Fashola should look into it with caution because what works in Lagos may not work in some other parts of the country without modification.”

To qualify for housing units under the policy, applicants must be resident in Lagos, be a first time home buyer not below 21 years and must be tax compliant.

Applicants must also be ready to make five per cent commitment of total house’s cost and pass affordability test and not more than 33 per cent of the monthly income as payment.

Conclusion

Rent-to-own housing policy has come to stay in Lagos. Other state governments and real estate developers should explore this option to increase homeownership among Nigerians.

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Accenture: Technology fast changing lifestyles

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Technology is now firmly embedded throughout our everyday lives and is reshaping large parts of society, Accenture’s Nigeria’s Managing Director Technology, Mr. Niyi Tayo, has said.

 

He said this during the presentation of a new report by the company in Lagos. Tayo explained that advancing technology is fueling intelligent enterprises and that this requires fundamental shift in leadership as contained in Accenture Tech Vision 2018.

 

According to him, just as cities developed around ports and then railroads, or people rebuilt their lives around electricity, the world today is reimagining itself around digital innovation — and, by extension, the companies that provide those services. He said this digital trend, thus, requires a new type of relationship, built on trust and the sharing of large amounts of personal information in a secure manner.

 

According to Tayo, Nigerian banks and telecommunication companies are also taking the first steps towards artificial intelligence (AI) to improve customer service by implementing chatbots. Besides, he said that they are beginning to use advanced analytics to provide next best product offers to increase product uptake and fraud analytics to manage risks.

 

The Technology Vision identifies five emerging technology trends that companies must address if they are to build the partnerships needed to succeed in today’s digital economy: The Technology Vision identifies five emerging technology trends that companies must address if they are to build the partnerships needed to succeed in today’s digital economy, which include citizen AI, extended reality, data veracity, frictionless business and Internet of Thinking (IoTh).

 

 

“Through these new partnerships with customers, employees and business collaborators, companies are building greater trust and further integrating themselves into society, becoming more indispensable and fueling their own growth,” Niyi said.

 

In the report, Accenture noted that adopting AI for growth and positive social impact means forming new partnerships with customers and business partners Rapid advances in AI and other technologies are accelerating the creation of intelligent enterprises and enabling companies to integrate themselves into people’s lives, according to the annual technology report that predicts key technology trends likely to disrupt business over the next three years.

 

However, capitalising on growth opportunities while also having a positive impact on society requires a new era of leadership that prioritizes trust and greater responsibility, the report said.

 

The 2018 study highlights how rapid advancements in technologies, including AI, advanced analytics and the cloud, are enabling companies to not just create innovative products and services, but change the way people work and live.

 

 

This, in turn, is changing companies’ relationships with their customers, employees and business partners. As part of the Technology Vision, Accenture surveyed more than 6,300 business and IT executives worldwide.

 

More than four in five respondents (84 per cent) agree that through technology, companies are weaving themselves seamlessly into the fabric of how people live today. For example, they reported that Google, through its many applications and analytics capabilities, has integrated itself into people’s everyday lives thereby influencing their way of life.

 

Google maps are used for journey management, references and suggestions on places, products and services of interest and through this, Google can shape people’s consumption behaviours. Also, Feedback from users can influence uptake of suggestions from Google by other people.

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Nigeria’s inactive phone lines rise to 93.3m

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The bearish trend in the telecommunications market in Nigeria persisted last year as the number of dormant telephone lines increased significantly to over 93.3 million or 38.5 per cent since 2001, New Telegraph has learnt.

 

According to data obtained from the telecoms regulator, the Nigerian Communications Commission (NCC), from the total of 241.3 million connected lines, only 145 million were active at the end of December 2017. This indicates inactive telephone lines of 93.3 million, which is equivalent to 38.5 per cent of the total connected telephone lines in the country.

 

From 2001 till date, the country has witnessed a geometric growth in telecoms subscriber base, having jumped from less than 500,000 lines to over 155 million active subscribers as at December, 2016, at which time total connected lines stood at 235 million. It was gathered that despite having reached 155 million active subscriber base in December 2016, a bearish trend where telecoms operators were losing subscribers set in in January 2017, a development that also subjected teledensity to a dip.

From 155 million in January last year, it fell to 154.1 million last February; 154.4 million in March; 149.2 million in April; 145.3 million in May and in June, the figure fell further to 143 million. In July, active subscribers were 139.1 million and 139.4 million in August while the September figure rebounded to 139.9 million In the same upwards swing, which started in August, the figure increased to 140.7 million; 142.3 million and 145 million in October, November and December respectively.

 

The crash in active subscriber base between January and end of July represents about eight per cent loss of the total subscriber base in the country. But analysis of the latest subscriber data showed that the subscriber loss was recorded overwhelmingly on the networks of global system for mobile communications (GSM) operators such as MTN, Globacom, Airtel and 9mobile, which control over 98 per cent of the total subscribers in the country.

 

According to the NCC data, as at last January, GSM firms collectively had 154.6 million subscribers. This figure crashed to 144.6 million by end of December, 2017.

 

Meanwhile, the bulk of the subscriber base loss on GSM networks has been traced to the wanton subscriber loss on the network of the recently troubled Etisalat (now 9mobile) where its active subscriber base crashed from over 22 million to 17 million subscribers. Reacting to this in an interview in Lagos, the Executive Commissioner, Stakeholder Management, Mr. Sunday Dare, said the speculation on sales of 9mobile, in particular, has culminated in millions of subscribers dropping their active lines on the network, thereby making them inactive.

 

 

According to him, “the unconfirmed report being peddled in the media in the course of the sale has had a negative downturn on the company’s subscriber base from 22 million subscribers to 17 milliion subscribers. We should know that the sales process of 9mobile is still on-going and speculations will not do the already-troubled brand any good.”

 

Meanwhile, between January and December 2017, the code division multiple access (CDMA) subscribers remained unchanged at 217,566 throughout the six month, but fixed wired/wireless networks’ and Voice over Internet protocol (VoIP) subscribers increased from 151,088 to 139,344 (fixed) and from 84,447 to 70,926 (VoIP) respectively.

 

Similarly, the teledensity has also been negatively affected as a result of the decline in subscriber base dropping consistently from 110.80 per cent in January to 102.19 per cent at the end of June, but peaked at 103.61 per cent in December, 2017. Telephone density or teledensity is the number of telephone connections for every 100 individuals living within an area.

Already, industry regulator and other analysts have been consistent in their positions regarding the factors responsible for the crash in subscribers. According to Dare, the crash in subscriber base could be linked to the tripartite factors, including economic recession (though this is said to have been over), SIM churning and technology convergence, making most telecoms consumers opt for over the top (OTT) platforms such as WhatsApp, WeChat, Vibre, Facebook calls and Blackberry Messenger, among others.

 

Meanwhile, President, Medallion Communications Limited, Mr. Ike Nnamani, said the issue of OTT will continue to affect subscriber base, which will compel operators to be more innovative as the development eats into their revenue base.

 

Commenting on the potential loss by telcos due to rising number of inactive lines in the country, Innamani, said: “It is unassailable that if a subscriber abandoned his or her registered line instead of using same to access mobile services, the affected operator is losing potential revenue and this, I believe, runs into billions of naira monthly.”

 

According to him, “no operator, whether small or big, wants to lose its subscriber to competitors or have them not using their lines for access services.”

 

 

Also commenting on the development by telephone chat with New Telegraph, Chairman, Association of Licensed Telecoms Operators of Nigeria (ALTON), Mr. Gbenga Adebayo, said: “Competition in the telecoms sector is getting keener by the day and this makes subscribers have the tendency to change their existing line for another preferred network, since they now have multiple options.”

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Govt warns against illegal telecoms installations

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The Federal Government thorough her telecoms regulator, the Nigerian Communication Commission (NCC), has said there is no hiding place for perpetrators of illegal operations in the telecoms sector, warming them to desist from the act or face the wrath of law.

 

Head of Enforcement Unit at NCC, Mr. Salisu Abdu, who led a team of ‘enforcers’ from Abuja to Lagos to clamp down on organisations indulging in illegal telecoms equipment causing disruption to telecoms services, stated this in a statement made available to New Telgraph in Lagos.

 

The enforcement exercise, which took place at Ikoyi area of Lagos and led to the fishing out of four culprits using equipment that jam network, was embarked upon following complaints from a telecoms operators that its services were being disrupted in the Ikoyi area of Lagos.

 

Abdu explained that under the Nigerian Communication Act, 2003, it is illegal for any person or organisation to install any communications equipment capable of causing threats to service interoperability because such a practice degrades the quality of service, adding that GSM boosters was one of such equipment being used by the culprits to dampen quality of service on mobile networks.

 

“This equipment called GSM boosters were installed and were being used illegally. What they actually do with GSM Booster is to improve the quality of service in the user companies’ premises at the detriments of neighbouring residents.

 

“So, what the equipment does is to extort services from other telecoms services users around and localise within the user’s premises,” he said .

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