Abuja – December 29, 2023 – Viewpoint Housing News.
The Federal Government, along with the Mortgage Banking Association (MBAN), have taken the lead to examine alternate sources of financing for affordable housing in the nation, in an effort to develop long-term, sustainable solutions for the mortgage subsector’s financial needs.
The process was spearheaded by the heads of the Nigerian Exchange Limited (NGX), Temi Popoola, the chief executive officer, and Ahmed Dangiwa, the minister of housing and urban development. They convened in Abuja to discuss creative ways to address the supply and demand chain of the housing system.
They emphasised the need to significantly boost the GDP (gross domestic product) contribution of the total mortgage banking and home finance industry for the country, which was estimated to be 0.38 percent, in contrast to other nations like South Africa and Malaysia, where the average rate is 40 percent.
They spoke about possible ways to get developer finance for workable supply-side housing projects, such securitized crowd fundraising via the NGX platform. To address the demand side, the parties also took insurance companies and convertible bonds into consideration.
“With the involvement of all pertinent stakeholders, including the Pension Commission, we aim to continue these discussions towards identifying the most effective frameworks and mechanisms to deploy and promote,” stated Dangiwa.
The 20th annual Chief Executive Officers (CEOs) retreat for the mortgage banking subsector, hosted by MBAN in Abuja recently with the theme “Advancing Sustainable and Affordable Housing Finance in Nigeria: Navigating Macro-Economic, Legislative and Policy Frontiers,” laid the groundwork for the gathering.
During the forum, the minister tasked the CEOs with coming up with inventive ways to create cutting-edge financing solutions that are sensitive to Nigeria’s current economic climate, like adopting rent-to-own mortgage options and flexible monthly mortgage loan repayment terms to lower the cost of commercial loans.
Dangiwa also voiced worry about the underutilization of the capital market in terms of raising long-term funding for refinancing mortgage loans and investigating new ways to lower the cost of mortgages as the government works to address the more significant macroeconomic issues.
“since they are difficult to exchange, all certificates of occupancy and deeds of assignment as currently held are death assets with no commercial value.”In addition to considering the availability of housing and house loans from a business and profit viewpoint, it is our moral duty as leaders to increase access to affordable mortgages. Thus, he said, we must ensure that Nigerians in the low- and medium-income categories, in addition to the elites, may also get affordable mortgages.
“As leaders, we have a moral obligation to broaden access to affordable mortgages in addition to seeing the availability of housing and home loans from a business and profit perspective. Therefore, we need to make sure that Nigerians in the low- and medium-income groups can also obtain inexpensive mortgages, in addition to the elites, he added.
The MBAN president, Mr. Ebilate Mac-Yoroki called for the creation of special courts such as Investment and Security Tribunal (IST) in all the states of the federation to handle all mortgage and housing related matters as is being done currently in Lagos State.
He stated that, it is imperative that state governments adopt the model mortgage and foreclosure law (MMFL) in order to address the issue of foreclosure. Additionally, the establishment of mortgage and foreclosure authorities is necessary in order to regulate mortgages, foreclosure, and the enforcement of real property, among other related purposes.
Additionally, he advocated for the establishment of a housing commission or committee, composed of the Federal Ministry of Housing, Federal Mortgage Bank of Nigeria (FMBN), Federal Housing Authority (FHA), Family Homes Funds Limited (FHFL), Senate House Committee, Nigeria Mortgage Refinance Company Plc (NMRC), Shelter Afrique, MBAN, Real Estate Developers Association (REDAN), Central Bank of Nigeria (CBN), Federal Ministry of Finance/Incorporated (MOFI), and Pension Commission (PENCOM), to review housing-related issues. The committee would meet quarterly to discuss housing-related matters
The mortgage operators advocated a central housing database so that all housing stocks created by FMBN, FHA, FHFL and Federal Ministry of Housing and Urban Development (FMHUD), shelter Afrique and all developers should be captured under one record.
He further made a case for an appropriate law that will recognize electronic print-outs of title documents as prima-facie evidence for house ownership through the Central Security Clearing System (CSCS) to facilitate trading (buying and selling) of mortgages to be done electronically.
According to Mac-Yoroki, “All certificates of occupancy and deed of assignment as currently held are all death assets without commercial value because they cannot be easily traded.”
