By Nse Anthony-Uko
ABUJA (Sundiata Post) – Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele has described the absence of long term capital to boost mortgages as the major challenges crippling Nigeria housing market adding that mortgages are not for short-term investment and credit.
This is even as he listed other shortcomings to housing finance as high cost of building materials which he said led to the growing number of unaffordable housing in the country.
He stated this in Abuja on Wednesday at the opening of a 3-day African Union for Housing Finance (AUHF) conference in collaboration with Nigerian Mortgage Refinance Company (NMRC) with the theme,”Housing and Africa’s Growth Agenda”.
AUHF is a 55 – member association of mortgage banks, building societies, housing corporations and similar organisations working on mobilisation of funds for shelter and housing on African continent.
Emefiele who was represented by the bank’s Director of Other Financial Institutions, Dr Ahmed Abdullahi further stated that registering and enforcing property rights was also hindering effective financing in the sector.
He said without addressing the challenges, that the housing market would not be set on long term capital stressing that development of Nigerian housing market is key to growing the economy and the Gross Domestic Product (GDP).
Comparing Nigeria and Africa housing markets, he added,” You will find out that the market is less developed because the contribution of housing market to the GDP is less than 1 per cent.
He noted that the housing market in United States represented 80 percent of their GDP saying that the single largest financial asset class worldwide is in the United States housing market which is more than US capital market.
On his part, the Chief Executive Officer of NMRC, Prof Charles Inyangete said the goal of the company is to raise longterm money in the capital market and to use the long term for refinancing mortgages .
On way out of Nigeria economic recession, he added, “The natural way is to borrow and there are also policies in place for borrowing but the borrowed money should be used wisely.
Inyangete revealed that the need for affordable housing globally is estimated to be 400 million units noting that the company is committed to providing affordable housing by reducing and extending mortgage rates as well as guarantying lower deposits.
Also speaking, the Minister of Power, Works and Housing , Babatunde Raji Fashola noted that housing 180 million Nigeria population is an arduous task that should not be left in the hands of government alone especially now that governments revenue and economy is under pressure.
While decrying the absence of funds to support the construction and mortgage sectors , he admitted that the cost of housing stock is beyond the reach of majority of Nigerians.
Fashola who was represented by the Head of PPP in the Ministry, Arch Eucharia Alozie emphasised that many years of inadequate investment and poor maintenance culture left Nigeria with a significant housing deficit.