‘NMRC is a big possibility that can change and shape Nigeria’s mortgage system’

When the Federal Government of Nigeria launched the Nigerian Mortgage Refinance Company (NMRC) in January 2013, the aim was to create a secondary mortgage market that would not only increase liquidity but also grow the mortgage system in the country by refinancing primary mortgage lenders.

Mortgage market operators, close watchers and other stakeholders have lauded this move by the government  which Adenike Awosika-Fasanya, a US-based mortgage consultant, sees as a big possibility that can change and shape Nigeria’s mortgage system.   

“One of the high points of the company is its long term, low rate global funds and the reason for this is because the mortgage industry here is not yet buoyant. NMRC, whether it is succeeding now or not, can be a very significant tool in achieving that”, she told BusinessDay in an interview in Lagos. Awosika-Fasanya advised that the mortgage industry had to be standardized so that global players, from global perspectives, could view the local industry from the perspective of NMRC and Mortgage Banking Association of Nigeria (MBAN) and see something to hold on to in their investment decisions, hoping that this would instill confidence in the investors.

She believes that the Nigerian economy, despite the current challenges, can conveniently support the growth of the mortgage industry in the country, noting that the only thing that will stop this industry from growing is over regulation by people who are not in the industry and therefore will not understand the effect of their policy on the actual market.

She also identified insurance industry which is not as active participant as it should be as one of the problems slowing the mortgage sector growth in Nigeria, leading to an abysmally low homeownership level in the country.

Erejuwa Gbadebo, CEO, Cluttons Nigeria, says that as a private sector driven company, NMRC has the public purpose of developing the primary and secondary mortgage markets by raising long-term funds from the domestic capital market as well as foreign markets and thereby provide accessible and affordable housing in Nigeria.

“We view it as a laudable project, one that we believe will be a huge relief to the housing sector access to single-digit; long-tenure loans can be achieved as the NMRC underwrites mortgage loans taken by the primary mortgage banks (PMBs)”, she said, adding that with respect to achievements, one of the key issues in any industry is creating awareness and,   “in this regard, NMRC has started well”. 

She recalled that “in April 2015 the NMRC hosted a Public Awareness and Capacity Building Workshop and later in July 2015, an interactive workshop on Growing the Mortgage Market in Nigeria: Harnessing Emerging Opportunities to Affordable Housing for Nigerians. 

“More recently in October 2015, and very much in keeping with the topical issues of the day, they hosted an Anti-money Laundering and Combating the Financing of Terrorism (AML/CFT) for Compliance staff of its member Primary Mortgage Banks (PMBs).  All of these speaking to their strategy to increase the efficiency of mortgage lending by taking a leading role in proposing changes to the enabling environment”.