Experts insist on favourable policies for affordable housing delivery

Experts in the real estate sector say for Nigeria to reduce its housing deficit  estimated at 17 million units by the World Bank since 2014, there should be collaborative efforts by the public and private sector operators to deliver houses that will be affordable to low-income earners.

Besides the 17 million housing units deficit, which has become a subject of debate for reasons of population growth, high urbanisation rate, rising number of school leavers, etc, Nigeria has one of the lowest home ownership level at less than 10 percent as against 70 percent in the US and 80 in UK.

Nigeria needs to build, at least, 200,000 housing units each year for the next 15 years to be able to bridge its housing deficit, but the total number of houses built in the country in a year by both the public and private sector operators is less than 50,000 units, making housing situation here critical.

The experts who spoke at an African Real Estate Conference in Lagos, Tuesday, insisted that when the private sector operators come with their capital and expertise, government should go beyond paying lip service to housing by coming up with favourable land and tax policies that should encourage private capital to go into affordable housing development.

“Affordable housing is not profitable to private capital, but the government can make it happen by playing its part, giving developers some comfort. Taxation should be friendly so that whoever brings in money should be able to take it out,” Uzo Oshogwe, MD, Afriland Properties, said, explaining that private sector capital that should go into affordable housing could only come as off-shore fund since the interest rate on local funds was outrageous.

Developing a creative way of incentivising private developers is another way housing could be developed and delivered at affordable cost. This, according to Femi Akintunde, GMD/CEO, Alpha Mead Group, comes in form of land-swap programme.

“In Lagos State, for instance, where urbanization and rural-urban migration rate is high, government can give free land to private developers in the highbrow locations such as Ikoyi, Victoria Island and Lekki and, in return, demand from the developer about 1,000 low cost housing units built in low cost area of the state,” Akintunde recommended.
The conference which had as theme, ‘Growing African Cities: The Reshaping Model’, took a critical look at high rate of rural-urban migration and the impact of that development on the growth of African cities.

A United Nation’s report on the growth of cities projects that about 60 percent of the world population will be living in the cities by 2050 if nothing is done to check the rural-urban drift, which calls for sustainable housing development not only to house the population, but also to reduce household energy cost.

Gbolahan Lawal, Lagos commissioner for housing, noted at the conference that African cities were developing fast with enormous challenges, pointing out that at an estimated annual urban growth rate of 5.8 percent, about 60 percent of Nigeria’s 170 million population would be living in the cities by 2025.

According to Lawal, strong urban bias has led to the neglect of the rural area, fuelling the migration that is mounting pressure on infrastructure. “Available record shows that six people come into Lagos every hour without any plan of what to do on arrival,” he stated.

“This is a big challenge to us as a government and this is why we are open to private sector operators who want to partner with us to deliver housing for the teeming population,” he said, announcing that through public private partnership, the state would be delivering 20,000 housing units by 2020.

The state is currently opening up the rural communities and building roads infrastructure to link those areas with the city centre which explains the ongoing and largely uncompleted reconstruction of the Lekki-Epe Expressway, Lagos-Badagry Expressway and the Abeokuta Motor Road with special arrangements for the state’s bus rapid transit (BRT) system.