‘We increase homeownership level in Ogun through subsidy’

The present administration in Ogun State has, in the last five years, done massive housing development  and land allocation using its land and housing agencies. In this interview with RAZAQ AYINLA, General Manager, Ogun State Housing Corporation, JUMOKE  AKINWUNMI,  highlights what informs the provision of affordable housing  for public servants in the state. She also speaks on the corporation’s plans to provide more housing in the state. Excerpts:

Recently, Governor Ibikunle Amosun allocated 160 housing units comprising 2 and 3 bedroom bungalows and semi-detached houses at the  A.A.K Degun Mitros Estate to public servants. What does the government stand to gain from this gesture?

The governor has keen understanding that if he is able to solve some of the challenges that the average person in the state faces, in return, you expect that his productivity level will also improve and, at the same time, it will also create jobs.

People are developing competences and the economy is booming because of other areas of impact. When you deliver housing, the beneficiaries of the houses will become economically viable because they have assets at their disposal that they can use as part of climbing the economic ladder. So, I think all of those will add to comfort and good livings of the recipients. And it’s obvious that this is one of the cardinal programmes of this government.

Now that you have allocated the housing estate to state workers. What value are you adding to the lives of these public servants?

Majority or all of the home owners are public servants. I am not sure how many of them are living in such neighbourhoods  now because here we have power, portable water, etc. This estate is supplied by two 500 KVA Transformers. The issue of transformers overload is not there.

We have water storage capacity of more than 200,000 litres; water is coming through a treatment process. So, we are talking about portable water; we have an environment that is truly communal and cordial. There is a facility that is being built that allows residents to come together; it is called Residence Pavilion, to interact and socialise.

There is small place where people can buy the basics. Altogether, this a gated community of great value. All the 160 units are very well built. It is a combination of 2 bedroom flats, 2 semi-detached and 3 bedroom flats. They have been thoughtfully designed and are, by no means large houses. But they are comfortable houses with everything any normal families would want.

What  should residents of the state still expect from Ogun State Housing Corporation, having been designated by government as pro-poor agency when it comes to housing delivery?

The Ogun State Housing Corporation will continue as we have always done. I always say we help to democratise homeownership and it’s in different ways. For some people, they prefer the more informal way – I buy my land and I build, we enable that as well. There is a lot we have in housing estates and we have sold thousands of plots and acres of land to people who have then gone on to build on them. But, if you want to tackle housing at the scale that we are thinking, that is not the most efficient way.

Efficient, better quality and standard housing comes  when there are agencies, private or public , who really go into housing delivery  and build community like this.  So, that is why the focus of Ogun State Housing Corporation is slowly shifting from an entity that sells land to actually getting involved in provision of housing in large scale. Under my leadership, we started from 76 housing units, and moved to 160 units and the next one is 500 units at Idi-Aba. As our own internal competencies improve, we also scale up to the need in housing sector.

Many state governments in the country talk about provision of low-cost and affordable housing for their people. How cost-effective or affordable are such houses?

Affordability is a funny thing. I think people should understand what it means when we say we are doing affordable housing. I would quote what the then Governor of Lagos state said, “If you can show me where there is affordable cement, then we will do affordable housing in the way people think”.

We have to build standard housing; we can’t say because we want to build housing for people of a certain income bracket we should use substandard materials. When we build housing in the most efficient manner, affordability comes in.

Yes, I know how much this cost us; it will cost N8 million by the time we provide water and electricity, but  we are going to sell it to a certain group of people for 60–75 percent  percent, or whatever is decided, of what it cost us to build. That is why when you are looking for affordability, what I will say is affordability and subsidy go hand-in-hand; there is no affordable housing without a subsidy and this is what  the state government  has done. As developers, we know what it costs to build these houses.

We were amazed when the governor announced what he was going to sell the houses for at the Town Hall Meeting last year and I remember that as soon as I saw him, I asked him what he was trying to do. Do you realise that you have just agreed on 30 percent subsidy? He laughed and said “yes; that is what I want to do.

But, he didn’t even stop there. I will call that level one subsidy. I sell something good to the governor at N8 million and he sells to the people at N5 million;  that is the level of subsidy, and then he says even that N5 million, don’t pay now, pay me 10 percent or 20 percent depending on the value of the house.

The houses are N4.5 million for two bedroom flat, N5 million for two bedroom semi detached and N5.5 million for three bedroom flat. It is only the three bedroom that people have to pay 20 percent, but for two bedroom, whether flat or semi-detached,  it is 10 percent down payment, so long as you meet the criteria of number of years of service  and so on. You pay the balance over a 5-year period.

What more does anybody want? You can’t walk into any bank for this. There is a small premium for the outstanding balance of 10 percent per annum. There is no where you can get this. For those of us who are in the sector, we know how long it takes before we get money from Federal Mortgage Bank.

For those people who will think Federal Mortgage Bank is doing 6 percent to 7 percent interest rate, the houses would have gone before you get that  money. For me, this is the best thing. Believe me, this is the governor that looks for quality thing. I know how many people that came here when we started and said we know you are building for public servants, why are you building like this?

If you see the people selling food and the number of trucks and trailers coming and dropping aggregates, you will know what housing delivery programme can do to the economy and lives of the people, and that is why in Ogun, the state government really focuses on that particular sector because he understands the fundamentals role it can play in kick-starting economy; it has economic, social and environmental benefits.

The Ogun State Property and Investment Corporation (OPIC) is entering into an agreement with Nigeria Mortgage Refinance Company (NMRC) to unlock opportunities for homeownership. Are you also subscribing to this agreement in order to ease homeownership?

The signage we are creating is incredible. We have been in close contact for nearly two years, particularly this year. We have had several meetings. What is happening now is not about OPIC and NMRC, or Housing Corporation and NMRC, or Ministry of Housing and NMRC, it is about Ogun State Government and NMRC. So, all of us benefit from the same umbrella agreement of everything that NMRC has to offer.