‘Govt should assist private developers’
What can private investors do to complement government`s efforts in reducing the estimated 17 million housing deficit we have in the country? There are a lot of opportunities in the property market and that is what makes me go into it. We are already liaising with 2 state governments with regards to creating low and […]
What can private investors do to complement government`s efforts in reducing the estimated 17 million housing deficit we have in the country?
There are a lot of opportunities in the property market and that is what makes me go into it. We are already liaising with 2 state governments with regards to creating low and medium housing projects in those states because that is what is lacking on one side. Another thing lacking is the financing mechanism for this project, how do they make this housing affordable to Nigerians? What is actually happening is that people are building houses for 50 -100 million naira how you expect the low income earners to buy this. So we are at the verge of signing agreement with these two state governments and building low and medium house scheme for the people. It is also very gratifying to know that the government is also trying to re-jig the Nigerian mortgage system through the new company created to finance mortgages for Nigerians. It is very saddening that you go to the bank you want to get mortgage they give you at 20 something percent over 5 years how do you expect me to pay? So even if we provide the housing how do we make it affordable to Nigerians? But I think the current government is doing a lot with this new organization, the mortgage refinancing company, I think it will make these houses affordable to Nigerians. But again, it might just be on paper how do we make it available to those who really deserved it. We have the National Housing Fund for a very long time we all know how it will take to get the money. You might be chasing it for 6- 10 years, of course at good interest rate but again it is bank-wise spread. And that is why the issue of corruption is wide spread in Nigeria but when you know that you cannot get a mortgage system, you cannot get a house at a good interest over 30 years. People look for all ways and manners to get money to build for themselves.
Developers like you have been complaining of lack of infrastructure in lands allocated for mass housing which at the end add up to the cost of selling these houses. What is your take on this?
It still boils down to governance until we are able to have a good government in Nigeria. There is no how you get somebody to provide houses to the people without infrastructure. So we developers will still have to provide these infrastructure if not you will not move to site so at the end of the day you are going to add the cost of providing this infrastructure to the cost of the houses.
If you take a look around Abuja you will see a lot of estates they also just start building without infrastructure I think the government and the development control and the organizations that it is their primary duties to stop this need to stop them. How can you start building without drainages, no roads, nothing? I don’t want to mention names but there are a lot of them in Abuja. For us in Stockcorp Property Development Limited the first thing we are going to do in all our sites is to get infrastructure in place once the infrastructures are in place before we start building, this is part of our plan and vision. It is not just about making money. Yes, we want to make money but we want to provide good quality housing for Nigerians.
What are the major challenges facing developers?
The first thing is funding, finance and also getting the regulatory approval. The first thing is getting a good site and after that getting the building plan approved by government agencies, this takes ages. And these are the things that should be made easier for private developers because at the end of the day we are also trying to assist the government in housing provision to the teeming populace. The government cannot provide all these houses all alone and by the time it takes you 1-2 years to get your building plan approval after that they will still be coming to disturb you that you didn’t get approval for this and that; all sorts of things just to create bureaucratic bottle necks here and there.
If the government say they really want this housing deficit to reduce they should make this easier for us. Also, the issue of funding, I don’t want to say it is a problem but a challenge. But I think a lot of banks and other financial institutions are also making efforts to assist. And we are also looking even for offshore funding to finance some of our development.
The issuance of C-of- O has also been identified as a challenge. Are you quite okay with the current method it is being issued to house owners?
I think most state governments are also trying to follow the Abuja model in terms of issuance of C of- O and making it a little bit easy. I think that is quite commendable, a lot of them are setting up organizations in the mould of AGIS. I was in Kwara State of recent and I discovered that the system seems to be working very well, once one is able to pay the fees. And again the issue of the fees for these C-of -O is too heavy, I think for developers’ government should provide a kind of incentives to encourage developers.
What do you think government can do to crash the high cost of property not only in Abuja but across the country?
I want to think it is coming down already. Yes, every day in Abuja, a lot of houses are coming up but most of these are not for low and medium earners. They remain empty and unoccupied. If you are building a house terrace in Jabi for 50 million naira for instance, you can’t expect the developer to sell lower than that or expects a typical civil servant to be able to afford that. We need to get to the satellite towns and build up small estates 1-2 bedrooms for Nigerians of low income earnings. And get houses that can be affordable between 5-10 million, but government needs to provide the lands. But we need to open up the satellite towns. Even in advanced country like the UK a lot of people live outside London, but the issue is we all want to live in the city centre even a junior civil servant wants to build in the city centre. Kubwa and co have turned into cities why don’t we go there even in Abuja there is place called Adaobi in Gwagalada, different areas in the outskirts but again do you blame them we don’t have a good transportation. How do people come back to and fro? Until we sort out our transportation system prices of houses will still be on the high side because people want to live nearby.
Some also raised the issue of high cost of building materials, how do developers like you view this?
I think in the last couple of weeks, the prices of cement has gone up over 2 thousand naira and ultimately it will reflect on the finished product and that is the houses.