Housing deficit: Government urged to tap into pension funds
Clement Adeyi, Osogbo
To bridge the housing deficit in the country currently estimated to be in the region of 22 million units, experts in the real estate industry have called on the government and players in the sector to consider working with pension funds administrators to fund the sector. They bemoaned a situation where many employees who contribute to pension funds live in deplorable conditions.
This submission was made as a part of recommendations at the fourth edition of the Real Estate Outlook Conference organised by Alphacrux Limited, a leading real estate firm, at Landmark Tower in Lagos.
Themed: “Repositioning Nigeria’s Real Estate Industry for a New Decade,” the conference brought together stakeholders who spoke extensively on the ways to make homes affordable for the average Nigerian and how government policies can help make this a reality.
They also harped on the need for effective planning strategies, data analytics and research, technology, and need for more collaboration among players to unlock the opportunities in the sector.
Speaking at the event, Tobi Adama, CEO, Alphacrux Limited said infrastructure upgrade can help address the housing deficit in Nigeria.
“If we can look at the area of infrastructure critically in partnership with the government, this challenge can be solved. The reason why people want to live on the Island is because of proximity to work. If you are not working on the Island, you won’t want to be on the Island. We need to look at the use of waterways, helicopters and trains as means of transportation to various destinations. So if you will marry all these different approaches together, then I think we will get somewhere,” Adama said.
He stressed that with Lagos being over-populated, there are still spaces to develop more properties in other States but because Lagos is a commercial hub, you find this peculiar problem with Lagos.
He suggested that with the rise of private properties especially at the Lekki corridors, infrastructure upgrade should be taken into consideration.
“If it takes me 30 minutes on a bus from Epe to Victoria Island and I find that property in Epe is cheaper, a lot of people will move to the outskirts. I think that as we are tackling the housing deficit, we should also be tackling infrastructure deficit.
“We are already in deficit and what I always tell people is that we need to classify what deficit is. Most of the time, what people can afford, they don’t like but what they like, they cannot afford,” Adama said.
He explained that the real estate industry in Nigeria is still at its infancy stage because there are so much that Nigeria has not tapped into and that is the reason why Alphacrux decided to have the Real Estate Outlook programme, so as to bring many stakeholders in the real estate industry together and look for avenues to increase the contribution of the real estate industry to Nigeria’s Gross Domestic Product (GDP).
Ayo Ibaru, chief operations officer at Northcourt Real Estate said Nigeria is underestimating the size and complexity of the housing deficit problem as a country, adding that the government needs to establish a framework under which affordable housing components can play.
“You can say affordable housing as many times as you want but if there isn’t a place where the developers, investors, and end-users can plug in, it will just be a pipe dream. By framework, I mean what are the conditions the government is willing to create to ensure a win-win solution for everyone?
“This idea of developers, financiers, investors, professionals coming together to invest their time and money in a third world economy without any form of return is something we should forget very quickly,” Ibaru said.
He suggested that government needs to have a strong framework, get the legal process, take it through the Senate and get it signed after which the government can now start funding and allocating land.
“While we are trying to sort out the land use act, let us look for other alternatives. If we don’t have a house that has funding opportunities and is less than N5million, I am not sure we have started dealing with the affordability issue,” he said.
Ibaru also suggested implementation of social housing, where the government can decide to take large lands usually in areas that are far from the city and build 1000 to 5000 units, adding that Nigeria cannot solve 17 million housing deficit with 100 or 300 units.