The administration of Governor Akinwunmi Ambode has finally rolled out its rent-to-own housing scheme and rental housing programme, targeting the state’s low and medium income earners, Gboyega Akinsanmi writes

Fortnight ago, Lagos was admitted into the league of 100 Resilient Cities in the world. It was not an invitation for funfair, but purely a platform for cities with common challenges. And its essence, as the President of the 100 Resilient Cities, Mr. Michael Berkowitz said, centres on the need for the cities in the league to compare notes and work together to turn their concerns to opportunities.

The mission of the league truly excites the state governor, Mr. Akinwunmi Ambode. For him, the league offers Lagos opportunities to exploit the massive opportunities that come with the megacity rather than dwell on its challenges. So, at a workshop where the state was formally admitted in Ikeja, graphically, Ambode x-rayed some challenges, which he said, were created by the state’s rising population.

By estimate, he said, Lagos now has a population of 23 million. At least, about 86 persons migrate into the state every hour. Consequently, according to him, this trend has created challenges of managing a daily increase in human and vehicular movement. Aside its transport challenges, Ambode said the state “is faced with ocean surge, high unemployment rate, growth of slums and huge housing deficit.”

Also, Ambode pointed out the challenges of flooding, undue pressure on physical and social infrastructure as well as insecurity, which he said, had been the burden of Africa’s fastest growing megacity. Of these challenges, however, housing deficit is perhaps the most threatening due to what the governor ascribed to as its multidimensional implication for the state’s sanitation and security.

Credible statistics attests to the widening gap between housing need and available housing in the state. In 2016, for instance, the Commissioner for Housing, Mr. Gbolahan Lawal, said the state had a deficit of 2.5 million houses. The shortfall represents about 14.7 per cent of what the country’s total housing deficit, which the National Bureau of Statistics (NBS) put at 17 million at the same period.

Reflection on the past
Obviously, the previous administrations had come up with diverse housing initiatives, though with insignificant impact. After he assumed office in 1999, the state’s former governor, Senator Bola Ahmed Tinubu opened up different housing schemes in Oko-Oba, Agege, Ikosi, Magodo, Lekki, Isheri and Ojodu among others. However, the schemes did not really meet the growing demand for housing in the state.

But the administration of Mr. Babatunde Fashola believed in evolving an institution, which he argued, was imperative to make the state’s housing schemes sustainable. So, throughout his first term, Fashola performed poorly in housing sector. During his second term, Fashola came up with Lagos Home Ownership Mortgage Scheme and constructed some housing units in different parts of the state.

But Fashola’s emphasis was more on sustainability than affordability and accessibility. Under the Fashola administration, allocation of housing units was purely by raffles, an option that denied those who were qualified access to the schemes. Aside some constraints raffles posed, those who got offers were required to pay 30 per cent commitment fees, a condition most allottees could not meet.

Then, a requirement to make a 30 per cent commitment fee was a huge challenge for those interested in the scheme. For most residents, the requirement discouraged them from buying into the scheme. Aside, they complained about the value of the housing units. Findings showed that a three-bedroom apartment cost over N15.5 million in Igando, N18.7 million in Ogba and N32 million in Gbagada.

Although it was perhaps the lowest rate in the country, the mortgage scheme then attracted nine per cent interest rate per annum. Given these requirements, they said, most low and medium income earners, especially public servants, could not effectively fund the scheme with their salaries. Consequently, most residents, who could have applied for the schemes, said they had to back out from the process because they couldn’t meet conditions outlined for accessing the mortgage scheme.

Peep into the future
However, last week, it was the end of an era when the Ambode administration began allocating housing units under its rental housing policy and rent-to-own housing scheme. At least, 100 allottees were presented keys to apartments –from one-bed room to three-bed room – the allottees applied for. Also, it was the beginning of Ambode’s ambitious plan “to build 187,000 housing units annually.”

Under the old regime, prospective home owners were required to pay a 30 per cent commitment fee. But Ambode had reviewed the regime pragmatically with a view to making housing more accessible and affordable to low and medium income earners. Under the new regime, Ambode introduced rent-to-own housing scheme, which he said, allowed prospective home owners make only five per cent commitment fee.

Aside his rent-to-own housing scheme, the governor initiated rental housing programme, which he said, was designed for residents who were not interested in buying housing units in the state. Such residents, according to him, did not want to own homes in the state, but only planned to live in any of the schemes and later relocate to their own private apartments or move out of the state.

As part of its review, the Ambode administration approved reduction in the prices of housing units across the state. The reduction ranged from 48.6 per cent in the case of two-bedroom apartment to 53.48 per cent in the case of one-bedroom apartment. It, however, differed from location to location. Also, it differed based on the size of apartments under different schemes across the state.

For instance, Ambode said the price for a two-bedroom apartment had been reduced from N7.2 million to N3.5 million, representing about 48.6 per cent. Also, he said the price of one-bedroom apartment was reduced from N4.3 million to N2.3 million, thereby accounting for 53.48 per cent. Similarly, though differed based on location, he said the price for room and parlour was crashed to N1.5 million.

And the drive, according to him, is basically to make housing more accessible and affordable for low and medium income earners in the state. Ambode thus said the review was in tandem with his administration’s social welfarist programme, which he said, formed the essence of any government. “For us,” he acknowledged, “descent housing is a means of enhancing the welfare of our residents.”

Unequivocally, the governor said his administration “has initiated a new regime of affordable housing scheme. From here, we can behold a future, which offers our brothers and sisters, either in public service or private sector, rare opportunities to own their homes. We have reviewed the old housing regime purely in public interest and created a new one that guarantees access to descent housing.”

Housing for all
Categorically, Ambode explained his decision to review the housing policies, which according to him, “became imperative to reduce the effects of economic recession on its residents as a responsive government. The need to cushion the effects of economic recession brought about the new policies to make housing affordable to all residents in the state irrespective of their ethno-religious backgrounds.”

The country’s prevailing economic condition was not the reason for the review of the housing policies. Ambode, also, cited the inability of people to actually process mortgage as a major challenge. At this instance, the governor said it was time for the state government to be more responsive, which he observed, was the core reason his administration adjusted the mortgage scheme to rent-to-own policy.

He argued that it “is better that people can just come in; pay one month rent and continue to pay their rent on a monthly basis. These housing units are for the people. We want the people to have access to them. If residents are interested in owning, they do not need to make 30 per cent commitment. They should just come in and apply. They do not need to know anybody also. It is open to all.”

Despite an extensive review of the state’s housing policies, Lawal lamented public indifference to the state’s housing programmes, which he said, was borne purely out of Ambode’s social welfarist policy. He thus said the need “to create a new face of accommodation for Lagos residents, especially the low and middle income earners has become imperative in view of the state’s increasing population.”

On this ground, Lawal said the Ambode administration “has taken the bull by the horns through the implementation of its rent-to-own housing policy aimed at making housing more readily affordable and accessible. Under this policy, all prospective home owners only need to make a five per cent commitment fee; take passion afterwards and pay up the balance over a period of 10 years.”

He explained Ambode’s housing initiatives, which he said, were unveiled three months in four locations comprising Epe, Ikorodu, Agbowa and Ojokoro. He therefore said the governor “has fulfilled this lofty vision with the delivery of housing units to 100 beneficiaries. The housing initiatives were introduced in response to the yearnings of the populace for cheaper and more affordable shelters.

“This quest prompted the state government to come up with some kind of innovation and amendment to the existing policy in order to meet up with the growing challenges of housing in Lagos State. The first batch of 100 rent-to-own allottees received keys to various apartments they applied for in five estates already earmarked for the state’s rent-to-own housing programme.”

Aside the rent-to-own scheme, Lawal explained the rental housing programme, which he said, was put in place “to meet the need of the residents who may not be interested in ownership or may not be able to meet the requirement of 30 per cent equity contribution for mortgage or five per cent commitment fee for the rent-to-own housing scheme. Tenants can move in on payment of one-month deposit.”
Mr. Dehinde Tunwashe, the General Manager of Lagos State Mortgage Board, revealed that 4,355 housing had been earmarked for the rent-to-own housing programme across the state. Of the 4,355 units, he said, only 100 were allocated. Aside, he added that the state government had resolved to allocate a minimum of 100 housing units per month, which he said, would go a long way to stem the deficit.

Tunwashe, thus, disclosed that the rent-to-own schemes “comprise a total of 12 estates spread across the five divisions of the state. Our estates, which are located in a serene and beautifully gated community, are usually equipped with facilities like water treatment plant, adequate parking space, healthcare centre, estate management office, street lights, recreational area and police post for security.”

Testimonies of allottees
Contrary to what is obtainable in other climes, the general manager observed that the housing initiatives “are implemented without bias or favoritism.” Different accounts of beneficiaries, who spoke with THISDAY last week, attested to Ambode’s disregard to prejudice on ethno-religious grounds. Rather, they confirmed, the schemes were allocated fairly irrespective of where the applicants came from.

Mr. William Isebor, a chartered accountant from Akwa-Ibom, said a friend brought the state’s new housing policy to his notice. He said he was not from Lagos State, but just decided to apply because it only cost him an application fee of N10, 000. According to him, I just applied and went back home. Isebor noted that he never thought anything good could come out of his application.

Surprisingly, however, he received a message about four weeks after he applied that his letter of offer was ready. He thus said he never believed it would work. When he heard about the initiatives, Isebor simply thought it was one of those rhetorics politicians often rolled just for formality. But he said he was proved wrong after he received his letter of offer and completed the processing.

In the case of Mr. Idowu Bamidele, his father brought the new scheme to his knowledge the morning after Ambode formally kicked off the programme. But he said he was not interested in the scheme. He thought it was a political propaganda. But his father sent him link to the Lagos HOMS website where he got additional information he acted upon. He eventually applied for a one-bedroom apartment in Epe.

Afterwards, Bamidele called his father, asking if he could help lobby to enable him clinch one of the apartment. Sadly enough, his father did not have such connection. So, according to him, “I just resigned to fate”. After about three week, he got a message from the mortgage board that his application sailed through. He never thought he could get it; neither the process of the schemed could be that transparent.

Beyond rhetorics, the Commissioner for Housing said the delivery of first batch would not be the end. As promised, he assured that the state government “will ensure the delivery of at least 100 housing units per month.” But the handover of keys, he said, is no doubt an eloquent testimony to Ambode’s integrity and commitment. He added that it was a way of “putting smiles on the faces of Lagos resident.”