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Affordable housing: Govt tasked on sound policies



Affordable housing: Govt tasked on sound policies

 Stakeholders seek government’s subsidies to encourage acquisition of affordable housing units by low income earners. DAYO AYEYEMI reports

It is no longer news that an average city-dwelling Nigerian cannot afford to own a house due to their low-disposable income.

What the government and other stakeholders are doing to provide affordable houses to 17 million citizens in need of accommodation has become an issue of concern. From findings by New Telegraph, some of the houses recently constructed by private developers and investors are not affordable to majority of urban dwellers, resulting in hundreds of vacant houses dotting the landscape of cities such as Lagos, Abuja and Port Harcourt.

Also from the government’s side, some of its housing scheme, tagged; “affordable units’ are actually not affordable, as twobedroom and three-bedroom apartments in Anthony Ehahoro Housing Estate in Ogba, Lagos cost between N12 million and N18 million each.

Bothered by the nation’s housing crisis, especially for low and middle income groups, some stakeholders comprising policy makers, real estate developers and officials of government have tasked both the Ffederal and Lagos State governments to evolve new and sound housing policies that promote subsidies to substantially fulfill their social contract to citizens and stimulate private sector investment in construction.

The stakeholders, who gave useful suggestions during the celebration of the ‘World Habitat Day’ themed: “Housing Policies: Affordable Homes,” organised by the Lagos State Ministry of Physical Planning and Urban Development, called on government and housing providers to also adopt new technologies that encourage mass and quality housing production at affordable rates.

Housing subsidies

Providing the lead, a former Commissioner for Land in Lagos State, Mr. Fola Arthur-Worrey, who doubled as guest speaker at the event, enjoined government to approach affordable housing agenda from the demand side by helping families reach certain financial benchmarks that make housing affordable for them in order to promote economic growth.

“Government can intervene in the hope that a stronger economy and more employment with higher wages would improve the ability of households to acquire housing at market prices, using tax and other fiscal instruments as incentives,” he said.

According to him, lower interest rates, smoother mortgage processes, planning regulation and affordable credit can be deployed as subsidies by government to enhance home ownership among citizens. However, he cautioned government on the need to ensure that individuals fulfil their obligations to lenders, while ensuring that the courts speedily and ruthlessly enforce those obligations when he does not.

On housing subsidies, he also encouraged government to offer what he described as ‘tenant based’ subsidies to many individual low-income households to enable them pay rent, while of- fering ‘project based’ subsidies to owners of housing units that must be rented to lower income households at affordable rates.

Arthur-Worrey wants government to provide some level of public housing to low income households to avoid complete reliance on private units.

He said: “Government must strengthen rent control mechanisms and also ensure that the courts are effective in protecting the rights of landlords to speedily repossess their properties when tenants are in breach of the agreements.”

He noted that in most African cities, affordable housing for the urban poor, especially for a migrant class, was non-existent, hence the relentless rise of informal settlements. According to him, real household income has not kept up with rising house prices and rents.

Faced with few affordable options, he stated that many people had attempted to find less expensive housing by buying, building or renting further out, “but the longer commutes often result in higher transport costs that erase any savings on shelter.”


Arthur-Worrey stated that for policy makers to understand affordable housing challenges, they would require understanding of trends and disparities in income and wealth, stating that location demand availability/cost of land, cost of materials, cost of planning approvals, impact of corruption were factors that determine the cost of a house.

According to him, majority of houses in Nigeria are privately built because “government no longer has capacity to deliver affordable houses or sites and services or provide subsidies for a certain class of citizen.”

Besides, he noted that financial instruments and mechanisms for credit were cumbersome and often oppressive, making little economic sense and often leading to default. “Also, research has shown a propensity among borrowers to default on mortgage loans with the legal process often unable to resolve the matter, thus disincentivising investment in the housing sector,” he said.


Reeling out the efforts of his administration to tackle the issue head-on, Lagos State Governor, Mr. Akinwumi Ambode, stated that his commitment to provide decent and affordable housing for all had been demonstrated through the Rent-to-Own and rental housing initiatives introduced to enhance home ownership among low and medium income groups in the state.

Apart from reducing the initial deposit from 30 per cent to five per cent, he mentioned that a larger proportion of 80 per cent of the total stock of housing units under the programme was dedicated to rent-to-own scheme, which is targeted at the low income group.

“A total of 4, 355 housing units have been commissioned across the three senatorial districts of the state. Our plan is to deliver 20,000 units in three years.

This we believe will close the housing deficit gap and improve access of citizens to affordable housing,” the governor said. He explained that there was an ongoing effort in the areas of urban renewal and slum upgrading/ regeneration, in which private developers and other stakeholders are playing key role.

Lagos State Commissioner for Physical Planning and Urban Development, Mr. Wasiu Anifiwoshe, noted that making housing available within the reach of the common man was one of most critical issues in the socioeconomic well-being of the people, adding that the observation had made it a compelling need to source for the best resource persons to discuss the year’s theme. He said his ministry was partnering with all stakeholders to bridge housing gap in the state.

According to the Country Manager, UN Human Settlements Programme (UN-Habitat), Nigeria, Mr Kabir Yari, an analysis of housing affordability over the last 20 years has revealed that despite increasing demand, housing – including rentals – has been largely unaffordable for the majority of urban population.

“While millions of people lack suitable homes, the stock of vacant houses is gradually increasing,” he said, emphasising that addressing the housing needs of the poorest and most vulnerable, especially women, youth and those who live in slums, must be a priority in the development agendas.

Commissioner for Housing, Mr Gbolahan Lawal, listed some of the giant strides of the state government in dousing the tension of affordable housing challenge.

Chief Engineer, Pozzolana Plant, Nigerian Building and Road Research Institute, Mr. Rasaq Babatunde Lawal, said his organisation has come up with alternative building technologies for affordable houses, urging Nigerians to patronise them. CEO Nedcomoaks Limited, Dr Kennedy Okonkwo, blamed government’s lack of capacity to provide affordable housing for the citizens on policy inconsistency , endless political and administrative disruptions, experimentation and restructuring, devaluation of currency with consequent severe price hikes in building material costs, inefficiency and corruption in allocation of available land and construction.

According to Arthur-Worrey, others included corruption in allocation of housing stock, distorted supply chain for land, materials and services; poor investment recovery on sites and services provided; lack of sustainability of low cost housing schemes due to default of owner-occupiers and low tax contributions to government treasury.

He said: “Being a federation, there is no true and binding National Affordable Housing Policy beyond mouthing tired mantra such as “Housing For All By The Year 2000”, and therefore no consensus about how to advance that goal. Last line There is need for government to take proactive measures to resolve issues surrounding Land Use Act and mortgage finance to make affordable houses available for lowincome urban dwellers.

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