Bennett Oghifo
The Federal Government’s housing policy will target first time owners, with income within the bracket of level 09 and 15, the Minister of Power, Works and Housing, Mr. Babatunde Fashola has said.
This includes private sector people whose earnings fall within the prescribed grade levels.
The minster stated this as he unveiled the roadmap to the Federal Government’s Housing Programme, during the maiden City People Real Estate and Housing Lecture in Lagos, yesterday.·
Fashola said architects in the ministry were able to evolve nationally acceptable housing designs that reflected the nation’s diversity of culture and weather.
According to the minister, “My thoughts are directed on how to gradually and consistently increase the number of tenants who become owners, with a focus on first-time owners.
“Our first thoughts and actions are to avoid the limitations of the past initiatives and deliver a sustainable programme of National Housing that has wide acceptability.
“The Roadmap to this in our view is to evolve nationally acceptable designs that respond to and accommodate our diversity. I am happy to announce that we have concluded this, starting from about 21 different designs, working down to 12, and concluding on six.”
He said one, two and three bedroom bungalows, with court yards that respond to the climate situation and cultural leanings of the North, would be built in states in the North East, North West and North Central parts of Nigeria.
Also, blocks of 16 and 24 flats of one, two and three bedrooms and bungalows of one and two bedrooms would be built in the South-South, South-East and South-West and in the FCT.
The government, he said intends to mass-produce these homes, stating that “Our plan for sustainable supply is to standardise these designs (or modifications of them that may become necessary) and industrialise production, by standardising fittings such as doors, windows, roofing sheets, tiles and other components in order to use these standards to stimulate local mass production of fittings and finishing to meet the demands of mass housing.
“In this way, we will be achieving one major objective of the President’s economic plan of diversifying our economy. For example, the smallest of houses will have at least a main door, a kitchen door, a room door and a bathroom door making a total of four doors.”
He gave an hypothetical situation, saying “In order to build 250,000 units of that type of house, this market will need to produce one million doors.
This does not include pipes, taps and sockets for electrical appliances. I leave you to imagine what this can do for our economy if we produce all these items locally.”
He said with this, it would be boom time for small and medium scale businesses that were in this line of business, adding that the government would not use imported doors, windows, tiles, ceilings, plumbing accessories, cables, paint and iron – mongery on its housing schemes.
He said, “Our surveys indicate that electrical fittings such as sockets and door locks are still largely imported and we will use our demand capacity to stimulate local manufacturing or assembly, in order to keep the jobs in these areas at home.”
The next step toward industrial production, he said was to reduce the time it takes to build a block. “Our recent experience shows that a block of 12 flats usually takes 12- 18 months at the quickest and we are looking at designing moulds that reduce this time to six months or less. This would of course mean that we cannot change designs at will. We already have one or two serious offers in this direction and we will engage them as we go on. Once this is done, the next step should be ascertaining who will develop.”
The policy framework of standardisation of designs, use of local materials, and registration of developers had already started, he said.
On funding, he said the government currently had a budget of N35 billion this year, “which is not a lot by any measure. However, when compared with N1.8 billion budgeted by the last administration is a 1900% increase.
“Our first challenge is to show that we can utilise this budget given the late timing and all the preparatory challenges we have to surmount, and I am optimistic that we can.
“We must be mindful that all the things I have talked about; design change, standards, local supply of materials etc, are conceptual. Our reality will hit us when we get to the field. This is when we will know whether the concept will work.
“As in all initiatives, the laboratory is different from real life. The former is controlled and the latter is dynamic. So our objective is to use this budget to prove the efficacy of our concept in the short term.”
The minister said, “In the medium term, we will raise more capital outside direct Government Treasury, working with the Ministry of Finance, through Bonds, REITS and other forms of real estate finance. Funding sources such as pension funds, private equity funds, and the National Housing fund managed by the Federal Mortgage Bank to finance development and also acquisition will be our focus.
“It might interest you to know that for the first time since 2011, the Federal Mortgage Bank of Nigeria has declared a half year surplus of N423,653,187. This is against the backdrop of half year losses of N8.6 bn; N6.4 bn; N1.7 bn, N2.1bn and N8.6 bn in 2011, 2012, 2013, 2014 and 2015. Clearly the process of change is underway.”
He said on the long term, the role of the Ministry would be purely regulatory, controlling designs, quality of finish, construction methods and materials, guaranteeing off-take of any house that private sector can deliver, and strengthening the Federal Mortgage Bank to provide finance to developers and end users.
The Federal Mortgage Bank, he said recently requested an amendment to the payment process of the equity contribution of prospective home owners to be capitalised over a period instead of being paid at once and “we have approved this request.”
He said “While much of what I have discussed focuses on home ownership, there are a sizable number of people who cannot afford to own homes, but who can afford to rent.
“We have received some very useful suggestions about rent to own schemes, and the need to revive the culture of public access hostels once made popular by YMCA and YWCA and I think that this is one area where private sector can play a huge role.”
