Building for the poor

In Marslow’s hierarchy of human needs, shelter ranks second to food, which pre-supposes that without food, shelter is the most important of all man’s needs on earth. Similarly, the National Housing Policy (NHP) of 1991 states that every Nigerian has a right to a decent and affordable accommodation.

However, the housing situation in Nigeria today, where the demand-supply gap is as wide as 16 million units with only 10 percent homeownership, obviously belies both Marslow and the NHP.

A critical look at this deficit shows that it tilts stubbornly towards housing for the poor who can hardly afford the millions-of-naira property that the market offers. In a mortgage-free environment like ours, where homeownership is by cash and carry and there is no social housing arrangement by the government, the poor are mere spectators, begging the question as to who builds for them.

We are worried that whereas the government tells whoever cares to listen that its responsibility in housing delivery is creating the enabling environment, private sector operators in the housing sector have concentrated efforts at building for the rich and the wealthy, leaving the poor to their fate.

A one-time commissioner for housing in Lagos State told journalists at a groundbreaking ceremony that government cannot build low-cost housing because it also goes to the same market where building materials are costly, adding that they are also in business to make profit. But a developer who spoke to BusinessDay said low-income housing is the business of government, explaining that lack of infrastructure and cost of building make that segment of the market unattractive.

The developer said that his company, without any apology, develops and delivers housing to the mid-upper end of the property market, arguing that he would do mass housing only on the condition that he would get land free of charge, or at least it must be given to him at a huge concession.

“Also, I must get title for the land just by asking, that is, once I apply, I am given. Even at that, it must be given to me almost free of charge or at a huge concession,” he added.

From these standpoints, we can appreciate the dilemma of the poor in relation to homeownership and, for us, it is a very pathetic, though not helpless, situation. Much as we believe in free enterprise and that the business of housing delivery is better managed by the private sector, we do not subscribe to a total abdication of the sector by the government because housing has a lot to do with policy issues. Apart from favourable regulatory issues around land matters, government should also be sincere and responsible enough to provide enabling environment for private-sector operators to come in and deliver affordable housing.

We align with the Nigerian Institution of Estate Surveyors and Valuers (NIESV) which has consistently canvassed some form of social housing for the very poor in society whose income cannot support homeownership. Even though the housing sector is better driven by the private sector, government still has to enable equitable distribution of housing to ensure that everybody is properly housed, just like the Council Flats in India which has all manner of social housing components.

We recall that when the Federal Housing Authority (FHA) was set up, part of its mandate was to develop rent-to-own and social housing for the class of Nigerians who needs them. Today, the authority has gone commercial, building houses where two-bedroom and three-bedroom flats go for N6 million and N9 million, respectively.

Because of its huge impact on productivity and economic growth, we are of the opinion that all stakeholders should explore possible ways of making housing accessible and affordable to the poor.

It is on this note that we commend the Nigeria Mortgage Refinance Company, a private sector-led government initiative that holds promise of homeownership for the nation’s poor because of its relatively low interest rate regime. We only hope the company serves its purpose, especially in the face of recent macro-economic decisions taken by managers of our national economy.