Experts proffer solutions to issues limiting access to affordable housing finance – Tribune Online


Issues surrounding access to cheap funds for the provision of affordable homes for millions of Nigerians in need of accommodation came to the fore at the weekend while major stakeholders in the sector brainstormed on the way out. DAYO AYEYEMI reports.
Acceptable collateral structures/options, acceptable land titles, options for delivering off-take assurance, and pricing and tenure have been listed as blockage issues to accessing funds for affordable housing provisions in the country.
Providing solutions to the identified blockage issues in order to unleash sustainable and cheap funds for the provision of homes, the Housing Roundtable, organised by the Family Homes Funds  Limited (FHFL) in partnership with the Nigerian-British Chamber of Commerce is living up to the expectations.
In the thought-provoking forum, participants in attendance, which included real estate developers, housing corporations, investors, home buyers, and mortgage and construction finance providers, made useful suggestions on how to overcome the challenges to facilitate easy access to funding opportunities for the provision of affordable homes.
Giving some thoughts on affordable housing finance in Nigeria, Co-founder/Managing Director, Alitheia Capital, Mrs Jumoke Akinwumi, said there was a need to broaden the market and ensure the creation of an enabling environment to attract funds.
She noted that there is public and private capital, but emphasised the need to educate housing stakeholders on what it meant to fund affordable housing, options, and sources of funding and how to aggregate them.
According to her, the industry’s players should begin to think of new funding products rather than relying on conventional types.
She said that they must explore universal funding, adding that prospective applicants must package their products to speak the language of financing.
Akinwumi said: “The funds are there; the bulk of work is with us. You need to look at your products. Investors want to invest, they just want to see the products.
“Until we have the market that is transparent, we will continue to strangulate yourselves.”
The interactive working session of the forum was anchored by the Managing Director, Wemabod Limited,  Yemi Ejidiran.
The session was centred on how to address the blockage issues limiting access to financing affordable homes, the issues ranged from acceptable collateral structures/options to acceptable land titles: options for delivering off-take assurance; and pricing and tenure; with each group coming up with useful suggestions on possible solutions.
On acceptable collateral for accessing finance for affordable housing, the stakeholders suggested that apart from good land’s title such as Certificate of Occupancy (C of O), development on land; equity contributions by partners, housing development partners’ leasehold; guarantees from cooperative groups and accessing the cash-flow of prospective buyers with a steady flow of income should serve as collateral.
Besides, stakeholders also noted that delay during land documentation, corruption on the part of government officials and issuance of two different titles on a single plot of land have made C of O  not to be accepted as collateral by the financial institutions.

These issues, they pointed out also affected both the demand and supply sides of housing delivery.
To overcome the challenges of acceptable land titles,  the participants called for the establishment of a Central Land Registry at the national level, while each state is also mandated to create one to enable easy access by developers, investors and financial institutions.
“All state governments are to send all their land information to the central portal to enable checks and balances.
“All states should establish Geographical Information System (GIS) of land, and where the state does not has the capacity, it should contract the service to private’s technical experts”, they said.
In lieu of C of O or R of O,  the stakeholders enjoined the state governor or the Secretary to the State Government, to issue a covering letter, adopting Public Private Partnership (PPP) or forming a  joint venture (JV) to develop housing estate.
Such letter, they said, should be accepted in lieu of C of O.
They also called for the digitalization of land registries across the country to facilitate easy access to information on land.
On options for delivering off-take assurance, participants said it would go a long way if a developer could provide 10 per cent of off-taker, adding that letters of interest from organizations such as cooperative unions are also important.
On pricing and tenure, they called for collaborations with producers of building materials and professionals in the built environment to reduce costs of materials, house designs and building construction.
They pointed out that proto-type design and the use of modern techniques such as modular and prefab construction would go a long way to reduce cost.
They also urged the government to make cheap or subsidised lands available with the provision of road infrastructure for affordable housing provision.
Chairman, Lagos State Chapter of the Real Estate Developers’ Association of Nigeria (REDAN), appealed to the management of FHFL to make its presence counts in Lagos in terms of funding affordable homes, by working with private developers.
Earlier, President and Chairman of Council, NBCC, Mrs Bisi Adeyemi pointed out that 83 million Nigerians are earning less than N137,430 per annum.
The low-income nature of Nigerians, she said has made access to decent housing difficult for them.
Managing Director, Family Homes Funds, Mr Femi Adewole said the target of the company is to provide finance for housing schemes across the country.
According to him, FHFL targets the delivery of 500,000 homes by the end of 2022 but has been able to close about 30,000  homes.
Based on available data, he noted that eight out of ten Nigerians are without a decent home.
Quoting earlier data from the NBCC’s president, Adewole said that if housing is to be inclusive, it would be difficult to neglect the data.
With the current realities, he said it has become clear that citizens could no longer rely on the government to meet their housing needs but to go for the expansion of the economy.
For this reason, the FHFL boss said the organization is looking for developers as partners to improve its working relationship with them in providing financing for the provision of affordable homes.
“At the demand side, we have mortgage partners. Another part of the value chain is the low-income group. We are looking at rental housing. The youth may not have the affinity of owning a home, but we are ready to work with organizations to deliver rental homes.
On the issue of building materials, Adewole noted that most building materials were being imported from China, hence the high cost.
To bring materials’ prices down, he said that FHFL is already collaborating with the Nigerian Building and Road Research Institute (NBRRI), local door manufacturers and other people to deliver affordable homes.
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