Worsening living condition for households in cities
For a combination of factors including population explosion, rapid urbanization, lack of proper town/urban planning, failure of governance etc, living condition for households in Nigeria’s big cities is getting worse by the day.
In this part of the world, the growth of cities is synonymous with the growth of a clan of people now identified as the urban, and also the development of slum settlements which easily out-number the highbrow areas inhabited by the rich and privileged people in the city.
Talking about the big cities in Nigeria, Abuja, the political capital, Lagos, the country’s commercial capital, and Port Harcourt the oil region where a large chunk of the nation’s wealth comes from.
Many residents of these cities live without adequate housing, no electricity, good road network, no pipe-born water—many depend on private boreholes or surface tanks (wells) dug right at the centre of their premises while the sanitary condition of their homes are generally poor.
In Lagos, touted as a mega city by sheer population estimated at 20 million, living condition in its nine identified slum areas is better left to the imagination because many households in these areas live in sub-human conditions.
The McKinsey Global Institute estimates that 1.3 million households in this city could further fall into worse living conditions in Lagos and this is corroborated by the global think-tank which says the increasing un-affordability of housing is a growing challenge in Lagos and most other emerging mega-cities.
By 2050 also, in about 240 cities with populations of more than two million, it is projected that majority of households will not be able to afford standard housing units at market rates.
In Lagos, which is considered an extreme case, more than 90 percent of households are unable to afford standard housing units rates, thereby forcing them into informal and substandard housing. Nigeria has the third largest number of households living in substandard housing, estimated at 11 million.
Lagos is however, addressing the housing problem of its residents with the Lagos Home Ownership Mortgage Scheme (LagosHOMS) launched in March last year with the aim of providing housing finance at single digit interest rate and long repayment tenor of 20 years.
Though there is still affordability factor with the scheme which requires applicants to provide 30 percent equity in order to own a house through it, the scheme has made remarkable impact and progress having produced over 500 homeowners through its monthly draws for successful applicants.
The state government is optimistic that, in the next couple of years, the scheme would have reduced the its housing deficit estimated at two million units, adding that given its over 4,000 housing stock and many more units expected from construction sites in 25 locations in the state, this deficit would be reduced considerably.
In Abuja, the story is not better because, though people have not started sleeping under the bridge which is a common feature of Lagos environment, government’s blind eye to the fast slum development in the city gives cause for concern.
Such places as Nyanya, Kubwa, Mararaba etc which are on the outskirts of the city are mere time bomb that will explode when its time is up and common sense should advise government to start proper urban planning to control such developments before they become unmanageable.
Nigeria has under-developed mortgage finance system which is due to such factors as monetary policy and macro-economic conditions, especially higher inflation risk considered a major issue that limits access to housing finance in the country.
The establishment of the Nigeria Mortgage Refinance Company (NMRC) to provide lower rates for housing projects is a step in the right direction and, according to the president, Goodluck Jonathan, “the step we have taken is to create the enabling environment for primary mortgage banks and institutions to conveniently offer 20 year mortgages to the market since the ability of banks to deliver mortgage services is limited by the fact that 80 per cent of their deposits are for 30 days”.
The president added that the NMRC, in ensuring greater access to finance for longer tenors, will be key to accelerating the growth of the market for all income levels”, he added.
Expectations are high in the housing sector that more land will be freed-up as the Federal Government undertakes auditing and inventory of its land and landed property. This move is expected to facilitate the bridging of the nation’s housing deficit which the United Nations estimate puts at 17 million units.
A large portion of government’s landed property in various parts of the country is either locked-in or under-utilised, government officials say, assuring that the present effort is intended to optimise the use of such property.
CHUKA UROKO