Babajide Odusolu, a real estate and property development expert, has said that the Nigerian Government has no business engaging in the direct construction of homes for Nigerians. Instead of repeating the wasteful errors of the past, he said during the ongoing virtual Abuja International Housing Show, Government should focus on providing a robust structure and support for the private sector to engage in the development of affordable homes needed to meet the huge housing deficit Nigeria currently faces.
Odusolu, who was the immediate past MD of the Ogun State Property Investment Corporation (OPIC), said while the government’s desire to provide housing is laudable, his experience in the public sector has shown that government cannot by itself provide all the housing units needed, nor operate as effectively as the private sector. Odusolu stated that the FG’s plan to provide 300,000 housing units in 12 months is not just impracticable but also insufficient to scratch the tip of the deficit.
According to him “Government needs to actively involve the private sector in solving the problems of housing and homeownership in Nigeria. An enabling environment in terms of supporting policies and improved access to capital would bring urgently need stability and growth to the real estate industry. The government should focus on offering location incentives such as tax waivers, rebates and significant concessions to encourage property developers to invest in semi-urban and less premium locations that will make it easier for Nigerians to afford homes.”
Odusolu added that the existing practice of developers focusing on delivering homes in premium areas is tied to a need to get quick returns on investment. “If an enabling environment is created and property developers are incentivized to build housing units in semi and peri-urban areas with government entering into guaranteed purchase agreements to secure offtake, there will be a huge leap in the delivery and provision of affordable housing units” Such purchase guarantees, according to him, can be tied to a contractual obligation to train and use specified numbers of local artisans in every location. This he said would also deliver much-needed jobs in a sustainable manner.
Odusolu who is presently the CEO of Octo5 Holdings, a real estate and property development company, said the old norm of Government awarding housing construction contracts would not offer the needed transparency required to attract long term capital to the industry. This is because “such contracts are usually tied to political patronage, are ineffective and actually dis-incentivizes investors; whereas if government provides access to seed capital, the private sector will deliver more than the announced number of homes at prices that are affordable for the average Nigerian.”