{"id":3280,"date":"2017-04-12T01:29:35","date_gmt":"2017-04-12T01:29:35","guid":{"rendered":"https:\/\/amazingproperty.com.ng\/blog\/moves-to-tackle-affordable-housing-shortage-in-nigeria\/"},"modified":"2017-04-12T01:29:35","modified_gmt":"2017-04-12T01:29:35","slug":"moves-to-tackle-affordable-housing-shortage-in-nigeria","status":"publish","type":"post","link":"https:\/\/amazingproperty.com.ng\/blog\/moves-to-tackle-affordable-housing-shortage-in-nigeria\/","title":{"rendered":"Moves to tackle affordable housing shortage in Nigeria"},"content":{"rendered":"<p>\n<\/p>\n<div id=\"\">\n<div id=\"attachment_235837\" class=\"wp-caption alignleft\" readability=\"36\"><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing.jpg?resize=1280%2C720&#038;ssl=1\" data-lazy-src=\"https:\/\/i0.wp.com\/guardian.ng\/wp-content\/plugins\/ventra-lazy-load\/images\/1x1.trans.gif?ssl=1\" data-lazy-srcset=\"https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing.jpg 1280w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-640x360.jpg 640w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-1062x598.jpg 1062w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-320x180.jpg 320w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-281x158.jpg 281w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-562x316.jpg 562w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-531x299.jpg 531w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-487x274.jpg 487w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-974x548.jpg 974w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-600x338.jpg 600w\" class=\"wp-image-235837 size-full\" alt=\"\" width=\"1280\" height=\"720\" sizes=\"auto, (max-width: 1280px) 100vw, 1280px\"\/><noscript><img data-recalc-dims=\"1\" loading=\"lazy\" decoding=\"async\" class=\"wp-image-235837 size-full\" src=\"https:\/\/i0.wp.com\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing.jpg?resize=1280%2C720&#038;ssl=1\" alt=\"\" width=\"1280\" height=\"720\" srcset=\"https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing.jpg 1280w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-640x360.jpg 640w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-1062x598.jpg 1062w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-320x180.jpg 320w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-281x158.jpg 281w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-562x316.jpg 562w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-531x299.jpg 531w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-487x274.jpg 487w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-974x548.jpg 974w,https:\/\/guardian.ng\/wp-content\/uploads\/2017\/01\/mass-housing-600x338.jpg 600w\" sizes=\"auto, (max-width: 1280px) 100vw, 1280px\"\/><\/noscript><\/p>\n<p class=\"wp-caption-text\">In March the federal government announced it would waive an initial 10% payment on mortgages below N5m ($15,700) administered by the state-owned Federal <a href=\"https:\/\/amazingproperty.com.ng\/blog\/mortgage-preapproval-guide-for-home-buyers\/\">Mortgage<\/a> Bank of Nigeria (FMBN), targeting future homeowners taking out mortgages in the low-to-mid price range.<\/p>\n<\/div>\n<p>In the face of a <a href=\"https:\/\/amazingproperty.com.ng\/blog\/sell-your-home-online-fast\/\">housing<\/a> deficit that numbers millions of units, Nigeria is working to increase home ownership by improving access to credit and reducing development costs for low-income housing.<\/p>\n<p><strong>Easing mortgage access<\/strong><br \/>In March the federal government announced it would waive an initial 10% payment on mortgages below N5m ($15,700) administered by the state-owned Federal Mortgage Bank of Nigeria (FMBN), targeting future homeowners taking out mortgages in the low-to-mid price range. The average cost of a mortgage is $18,000, with interest rates at around 19% as of September, according to the Centre for <a href=\"https:\/\/amazingproperty.com.ng\/blog\/affordable-housing-markets-for-buyers\/\">Affordable Housing<\/a> in Africa.<\/p>\n<p>The move comes on the back of the creation in September of the government\u2019s Family Homes Fund. The mandate of the N500bn ($1.57bn) fund is to keep mortgage rates for affordable housing at well under the average 23%, targeting 9.99% payable over 20 years.<\/p>\n<p>With prospective buyers required to put down an initial deposit of 10% to qualify for these home <a href=\"https:\/\/amazingproperty.com.ng\/blog\/fast-flexible-real-estate-loans-usa\/\">loans<\/a>, 70% of the mortgages are expected to go to <a href=\"https:\/\/amazingproperty.com.ng\/blog\/really-nice-property-for-sale-in-nigeria\/\">houses<\/a> priced between N2.5m ($7900) and N4.5m ($20,000).<\/p>\n<p>Financed by the Sovereign Wealth Fund, federal government bonds and Bank of New York, the scheme will work as a public-private partnership. It is also expected to promote the development of primary mortgage institutions, which tend to have a narrow banking licence and are generally reliant on wholesale <a href=\"https:\/\/amazingproperty.com.ng\/blog\/get-quick-loan-for-real-estate-investment\/\">funding<\/a>, making them more vulnerable in times of financial or economic crisis.<\/p>\n<p><strong>New opportunities <\/strong><br \/>These changes will come as welcome news to many Nigerians, with half of the population living on less than $1 a day. Furthermore, the minimum wage is currently around $60 per month, meaning home ownership is often out of reach for those in the low- to middle-income wage bracket.<\/p>\n<p>A standard mid-level apartment in an urban area, for example, can cost roughly $100,000, with rent averaging around $5000 a year, according to the Centre for Affordable Home <a href=\"https:\/\/amazingproperty.com.ng\/blog\/construction-loans-for-commercial-and-residential-builders\/\">Financing<\/a> in Africa, leading to a home-ownership rate of 25%.<\/p>\n<p>Meanwhile, the mortgage penetration rate stands at about 0.6% of GDP, as per World Bank data, which although low by standards in more developed economies, puts Nigeria roughly in line with many other large African markets.<\/p>\n<p>Low mortgage uptake is attributed to lack of awareness and cost, as high interest rates can make mortgages too expensive for middle- and low-income earners.<\/p>\n<p><strong>Development financing <\/strong><br \/>In order to begin filling the country\u2019s existing deficit of 17m housing units projected by the World Bank and to meet the increase in demand, the government will need to support the construction of 170,000 units per year over the next decade.<\/p>\n<p>With almost half of the country\u2019s 184m-person population residing in cities and urbanisation growing at an annual rate of 3.75%, demand for affordable houses is also set to remain strong.<\/p>\n<p>To address this problem, the FMBN signed a memorandum of understanding in January with the <a href=\"https:\/\/amazingproperty.com.ng\/blog\/property-center-nigeria\/\">Real Estate<\/a> Developers Association of Nigeria (REDAN) and pan-African finance institution Shelter Afrique to establish a $2bn affordable housing fund.<\/p>\n<p>The money will help to finance the construction of a targeted 10,000 homes annually over the next decade by distributing $200m per year to developers. In addition, the signatories of the MoU expect the construction work generated by the funding to create more than 150,000 jobs.<\/p>\n<p>\u201cWe agreed that we needed to bring in Shelter Afrique to work in partnership with REDAN to make available some funds over the next 10 years by providing REDAN members with the necessary construction finance that is required to drive the national housing model,\u201d Richard Esri, acting managing director of FMBN, told media during the signing ceremony.<\/p>\n<\/div>\n<p>[ad_2]<br \/>\n<br \/><a href=\"https:\/\/guardian.ng\/property\/moves-to-tackle-affordable-housing-shortage-in-nigeria\/\"> link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In March the federal government announced it would waive an initial 10% payment on mortgages below &hellip; <a title=\"Moves to tackle affordable housing shortage in Nigeria\" class=\"hm-read-more\" href=\"https:\/\/amazingproperty.com.ng\/blog\/moves-to-tackle-affordable-housing-shortage-in-nigeria\/\"><span class=\"screen-reader-text\">Moves to tackle affordable housing shortage in Nigeria<\/span>Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":3281,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[4],"tags":[1238,519,1403,2890,1398,1399,1331,447,12908,543,627,127,617,489,344,604,408,1032,1295,312,522,1007,41,818,15296],"class_list":["post-3280","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-opportunities-in-new-markets","tag-affordable-housing","tag-africa","tag-buy","tag-construction","tag-developers","tag-development","tag-finance","tag-financing","tag-home","tag-home-buying-guide","tag-homeowners","tag-homes","tag-house","tag-houses","tag-housing","tag-loans","tag-mortgage","tag-mortgage-bank","tag-mortgage-rate","tag-mortgages","tag-nigeria","tag-owners","tag-property","tag-real","tag-target"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/i0.wp.com\/amazingproperty.com.ng\/blog\/wp-content\/uploads\/2017\/04\/mass-housing.jpg?fit=1280%2C720&ssl=1","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/3280","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/comments?post=3280"}],"version-history":[{"count":0,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/posts\/3280\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/media\/3281"}],"wp:attachment":[{"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/media?parent=3280"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/categories?post=3280"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/amazingproperty.com.ng\/blog\/wp-json\/wp\/v2\/tags?post=3280"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}