How NHF should work – Developer
What kind of houses do you build? At present, I have about 600 housing units of various types: two and three-bedrooms, as well as semi-detached duplexes in Lugbe. I have about 102 built by us in Suleja. We’re building 100 in Kano under the ministerial pilot housing scheme which is all affordable houses to Nigerians in […]
What kind of houses do you build?
At present, I have about 600 housing units of various types: two and three-bedrooms, as well as semi-detached duplexes in Lugbe. I have about 102 built by us in Suleja. We’re building 100 in Kano under the ministerial pilot housing scheme which is all affordable houses to Nigerians in line with the transformation agenda of Mr President.
We’re building a staff housing estate in Kuje [Abuja]. Were in partnership with the FCT Area Councils, the Federal Mortgage Bank of Nigeria in developing another 4,000 housing units, terrace type in Ushafa in Dutse, Bwari Area Council.
We have 200 houses meant for NHF contributors in Sokoto. We’re about starting in a couple of weeks. We have another housing estate of 2,000 for the cooperative of the NLC in Apo. We’re negotiating with them to see how we can come out with them because we want the houses to be affordable to Nigerians.
Give us the detail of the estate in Sokoto.
In normal situation, the Federal Mortgage Bank of Nigeria FMBN is expected to provide affordable houses to all Nigerians that are contributors to the National Housing Fund. Sokoto State is part of this because it contributes to the National Housing Fund. Federal Mortgage Bank is duty bound to make its presence in that place by building houses for the contributors of the National Housing Fund—give them soft facility to acquire these houses based on arrangement with the mortgage institution.
So how far have you gone with this?
We have everything on ground. What is wasting our time is the land has some certificate of occupancy…we merged them together and we are asking governor to give us a consolidated certificate of occupancy. We have already got the building approvals from the urban control office in Sokoto. We have started moulding blocks. We’ve demarcated the area. We’re waiting for that certificate to enable us move forward. Insha Allah, in a couple of weeks, we’re going to start work in Sokoto.
How many housing units?
Two hundred housing units. Three-bedroom bungalows and semi-detached two-bedroom and four-bedroom duplexes.
Many complain about the National Housing Fund. They say the fund hardly flows.
It’s not easy to provide all Nigerians that contribute for housing. You can make it available in piecemeal. You can’t take the whole of Nigeria. You can take zones, from zones to states, to towns so they can initiate their presence. In all the states of the federation, there are mortgage banks and people contribute. The federal government is supposed to intervene with an intervention fund to help the Federal Mortgage Bank because the contributions alone can’t guarantee the provision of the kind of houses we look for.
That’s why government brings refinancing company. The Federal Mortgage Bank gave loans to developers to go build houses. It gave direct loans also to PMBs to build houses. It gave loans to civil servants as well who are contributors to the National Housing Fund to enable them build houses.
In the last year, as I found out from the Federal Mortgage Bank MD, they’ve produced over 45,000 housing units in 2013. If they’re given the chance to increase by being given intervention fund by government…some N200 billion has been mentioned so many times that government wanted to give but we don’t know what happened, it never became a reality.
How affordable are your housing units in Lugbe, Abuja?
This is mortgage oriented housing estate. Mortgage provides the money to build these houses. These houses were allocated to various people from all walks of life: military, police, customs, civil defence, Central Bank of Nigeria, ministries, parastatals—so many people because it’s based on National Housing Fund. The Mortgage Bank provided the facility for them and the developer which is me to provide these houses which we have done.
The cost is determined by the Federal Mortgage Bank. For instance you can get houses between the cost of N5 million and N12 million in the estate.
How many units are here?
Over 500 units.
Isn’t it possible to further bring down the cost of houses N5 million may be small but to many it will be hard getting it?
We’re hoping it will work as planned by government. Because a mortgage refinancing company will bring its intervention fund which will now boost the building of so many houses. There’re only three things that will make a house affordable—everybody is aware.
First, prices of the building materials are high. Some of these building materials aren’t manufactured locally. You have to import them. That’s a problem.
The land acquisition by a developer or whoever is a hiccup in the process of getting affordable houses. There’s also the issue finance. The lending rate in the market if you go to commercial banks skyrockets–28 percent, how much are you going to build?
Building has a process. It doesn’t start today and end tomorrow. There’s a time frame to build and finish. And bank charges have time frame. The faster you go, the less charges you pay. These are the things in the building industry which if not checked, definitely to get affordable housing will be a story.
First, the allocation of land and certification of land should as government promises be put into the system and be done in a short time. Time is money in the building industry.
Two, the building equipment that are not locally made, there should be a drop on the duty. As long as we can’t manufacture these things, they should be duty free if we want cheaper houses.
An average Nigerian can part with N5 million for a two-bedroom bungalow. That’s what we look up for every Nigerian; to have a roof over their head. If we don’t drop the duty, it will always be calculated in the cost of buying and transportation, all put together will end up to the consumer. That doesn’t help the consumer.
Then cement. Now, you’ll see that there’s monopoly on cement by some segment of the society. It’s causing a lot of problem in the building industry. Some cement factories can’t move forward and the cost of cement goes up every day. We buy cement at N2,000. You can’t do anything in building without cement—it’s the primary thing in building. What do you expect us to do?
Have developers formally made a request to government to drop this tariff?
On cement, I’m part of the developers on the ministerial pilot housing that is being done across the country. There’s a plan by the Federal Ministry of Housing, Land and Urban Development that Larfage Cement can give you cement at controlled dealer price. We bought last time at N1,530. The company delivered to our sites, courtesy of the Federal Ministry of Housing Lands and Urban Development.
If that arrangement was extended to all cement manufacturers, it would have brought cement price down because the people buying the cement in trailers are we in the building industry, building mass houses. If we get it as cheap as this, prices will come down in the market.