No increase in supply at low-end market despite new building methods

Housing supply in Nigeria, especially at the low-end market, has remained significantly low despite the introduction of new building methods that are not only cost-effective but also capable of mass-producing low-cost houses for low-income earners who are mostly un-housed.

Conversely, the high-end market where demand is quite narrow is over-supplied with most of the houses unoccupied, leading to high occupancy rate which market watchers estimate to be in the region of 20-25 percent at the highbrow neighbourhoods of Asokoro and Wuse in Abuja, and Ikoyi, Victoria Island and Lekki in Lagos.

With homeownership at just 10 percent as against Singapore’s 92, analysts say the housing deficit currently at 17 million units would continue to widen for as long as government and real estate developers continue to ignore available cheap and affordable alternative building techniques, adding that continued reliance on brick and mortar for building would always lead to high cost of housing.

One of the many available new building methods or technologies is dry construction which entails the use of wooden materials such as gypsum board, plywood in construction without the application of plaster or mortar.

Experts emphasise that these alternative construction methods are cheaper and make homeownership more realistic to a larger percentage of the population (especially low-income earners).

Ronald Ashkin, technical director, Growth and Employment in States (GEMS), in an earlier interview with BusinessDay, observed that alternative construction methods, such as dry construction, which delivers housing at reduced costs and within a shorter period when compared to conventional building methods, should be embraced by real estate developers in boosting the nation’s housing stock. This, he said, would stimulate the supply chain to move faster, and consequently reduce the current housing deficit.

However, to Samson Akinyosoye, CEO, Proximal Heights Developments Limited, dry construction has not really thrived in the country because the awareness has remained low, adding that indigenous developers have not really embraced these modern trends as they still perceive it as a Western culture.

“Most dry construction houses lack the innovative exterior designs. Unfortunately, for developers who target the upper middle class, employing prefabricated building techniques won’t allow for flexing of aesthetics as most buyers would want,” he explained.

Akinyosoye, who spoke to BusinessDay in a phone interview, observed that building with frames, slabs and other alternative construction is most suitable for mass housing schemes. “Unfortunately, the government which is supposed to provide mass housing solutions for low-income earners has done little in recent time,” he said.

Adebayo Adeleke, CEO, Lancelot Ventures, told BusinessDay that alternative building technologies are relatively alien to most developers and the desire to provide intending home buyers with apartments that they find more appealing has further limited the growth of alternative building solutions in the country.

“Homeownership should be encouraged to be a trend in every community because it has a marked ‘push-up’ effect on the market as a whole, for the simple reason that people will always aspire for a better lifestyle, upgrade their homes and move up to more expensive units in near future,” Tony Clarke, managing director, The Rawson Property Group, a South African real estate firm, was quoted to have said in a report.

By: ODINAKA MBONU