‘What we are doing with LagosHOMS aggregates to social housing’

Consistently in the past nine months, Lagos State government has been producing homeowners on monthly basis through the Lagos Home Ownership Mortgage Scheme (LagosHOMS). However, contrary to giving out houses in triple digits as promised at the launch of the scheme in March this year, houses are given out to applicants in double digits.  In this interview with CHUKA UROKO, the state Commissioner  for Housing, BOSUN JEJE, explains the constraints to giving out 200 houses every month as promised, insisting however, that they have a large stock of housing for the scheme. He also speaks on the state’s public private partnership initiative and other issues. Excerpts:

At LagosHOMS launch in March this year, the promise was that 200 houses would be given out to applicants. What we have seen so far is at variance with that promise. What are your constraints?

Well, we promised Lagosians that we were going to deliver 200 housing units every month. On our part we have not failed; in fact, we have even surpassed that projection. Now, we have over 10,000 housing units that we are giving out. When you do a simple arithmetic, you see that we have more than 200 units that could be given out every month.

The major constraint to achieving this goal is documentation because, in Nigeria, we are not used to documentation.  We are using tax payers’ money to build these houses. We have not borrowed a kobo to do all these. This is why our focus is on the tax payer. The constraint really is from the subscribers because you must pay your tax and register as a resident of Lagos to qualify for the houses. The constraint is not from us because we have the houses waiting for the applicants.

Interest in this scheme has been quite encouraging, but we think it could have been more. There are complaints out there that the scheme is unaffordable particularly because of the required equity contribution which is as much as 30 percent. What do you think of this?

I don’t think the equity contribution is too much because  we must  build and make  the houses available at all time. We don’t want the scheme to flop and we don’t want to borrow money at 22 percent interest rate which we have to pass on to the buyers. The equity contribution could have been more but we are saying, pay just 30 percent and pay the balance over a minimum of 10 years or  extend it to 20 years at  9.5 percent interest rate. I think it can never be better. Even in advanced societies where you have well established mortgage system, 30 percent is the standard. This money we collect is used to build the houses that we offer to the subscribers.

It is surprising that Lagos with all the wealth available to it is still challenged by housing problem even with its dream of becoming a mega city. When shall we start seeing social housing in this state?

What we are doing already aggregates to social housing. We are giving out housing to people at low rates. We are not making any profit from the scheme. We give a rebate of 25 percent on each of the houses that we give out. More or less, what we are doing is an equivalent of social housing unless we have found a new definition for social housing.

Elsewhere, governments subsidise housing for low income earners?

Allowing people to pay for their houses in 10 years, for us, is a form of subsidy because what they are paying is even lower than rents they pay to landlords.  They are paying to own the homes, and not to landlords. The 25 percent I talked about is also a form of subsidy. We don’t want to stop this scheme by giving out houses free to subscribers in the name of social housing.

You have been the Commissioner for Housing in this state since the past three to four years. Looking back to those years, what could you say are the high points of your stewardship?

Giving out 200 housing units every month to those who truly need them is something I have not seen any other government do in Africa. This is a novel idea and, for me, it is an unparalleled achievement.  We are not just delivering houses, we are actually providing quality homes.

In the next six months, your administration will leave office. What  is the guarantee that this scheme would outlive you?

What we are doing now is a scientific exercise that took us many years to start.  We have packaged the scheme in such a way that the new government that will be succeeding us will not find it difficult to continue from where we will stop. I feel that the new government will find it very beneficial.

Going by your government’s projection, the mega city status for the state will start materializing from next year. Now, can we imagine a mega city without adequate housing for residents?

The National Bureau of Statistics puts housing deficit in the country at 17 million units and Lagos State alone has a share of one million units of this deficit. We are doing our best to bridge this gap. And in actual fact, government is not supposed to build houses. What we are doing is to encourage private sector to come in. We have designed some programmes aimed to achieve this. We want these private sector operators to partner with us in providing houses. What governments do is to provide the enabling environment for the private sector to provide housing for the people. We are bridging the housing gap at very slow pace, but by the time the private sector comes in, we will be able to move fast.

How much interest is coming from the private sector in this partnership initiative?

Seeing what we are doing in the three senatorial districts of this state, the private sector operators are already convinced that there is hope in this construction business.  They have been turning up in large numbers, and because my ministry is in charge of it, I can tell you that interest has been quite strong. We have been encouraging them and very soon, all these will start materializing.

In specific terms, how do you encourage these private sector operators?

Though we are still putting final touches to this initiative, I can tell you that we have assured them that when they build the houses, government will uptake them which is quite encouraging because it is not always easy to build and sell at once. So, what we have assured them of is a ready market. All they have to do is to come to Ministry of Housing, we give them the prototype of what we have and they go and build the houses.

As government, what do you bring to the table in this partnership, besides the ready market?

Up-taking the houses is one of the things we bring to the table and don’t forget that selling houses is always a problem. What this means is that even before you start building, the houses are already sold. Again, we also have land that we give to them.

CHUKA UROKO