Against the backdrop of the widening housing deficit in the country the need for governments at the federal and state level to see the issue of housing as an urgent matter of concern and priority cannot be over stressed.
Just last week, the immediate past Governor of Lagos state, Babatunde Raji Fashola (SAN) among other appointed Minsters, was assigned the minster of Power, Works and Housing.
The Managing Director/CEO of Realty Point Ltd, Mr. Gbadebo Adejana who spoke to Elsie Godwin of Nigeria Real Estate Hub (NREH) on the expectations from the housing sector as regards the 17million housing deficit in the country and where the newly appointed Minster, Fashola should look into has expressed the need of the Federal Government looking into the pension funds and see how to get the pension funds into the housing scheme. Stating that if Babatunde Raji Fashola fails, then the Buhari administration has failed.
“To a large extent, the portfolio distribution among the selected Ministers shows a team that is ready to work and I think that there is some logic behind. At least, looking at the people that I know there, it is obvious to see that their portfolios match.”
“But I have some concerns really for the Fashola’s post. For me it seem like the portfolio was specifically created for a person – the person of Mr. Babatunde Raji Fashola (SAN). Going by his antecedent in Lagos state as a Governor, he was virtually in charge of all the ministries and he performed almost in every of the ministry. He did something concrete and so I have no doubt in my mind that he will perform in that portfolio”Mr. Adejana also called on the federal government to institutionalise the ministries in other to pave way for smooth government transition. He expressed concerned towards the state of the present administration of Lagos state, implying that the shoes left for Governor Ambode were too much for him to fit in.
“The challenge I have is that if within the remaining 3 and half years he can’t institutionalise things, it will be difficult to get someone to fill that vacuum and still perform effectively. I mean, the magnitude of the kind of things he did is becoming probably obvious to us in Lagos state now with the new administration. I am sure the new administration is still trying to find its foot so that they can step up the game. It’s difficult to step up the game when the game is that high.” He said.
“We need to institutionalise certain things so that we can have continuity in a way that it will not be burdensome on the personality.”
“Governor Fashola seems to be a workaholic and he will be able to fit in.”
The interesting thing about that appointment also is that somebody jokingly said fashola is a prime minister, some have said he is a senior minister. He is obviously a powerful minister, no doubt. And the meaning and implication of that is that if Fashola succeeds, Buhari administration succeeds and if Fashola fails, Buhari administration cannot claim to have succeeded because if you don’t have power, housing, infrastructure at the end of this administration, then it would have been counted to have done nothing. And all of that is in the purview of one man. He is really a very powerful minister and I wish him all the best.”
“I think that Lagos state started while Fashola was there on the right part but one major thing I will need this administration to critically look at is how to get the pension funds into the housing scheme and housing sector because that is where we have a large deposit of low cost funds, low cost long tenure, and that is what we need to finance infrastructure, to finance housing and everything that Fashola represents. They need to unburden the pension funds such that it can be accessible to providers of infrastructure, providers of housing and providers of power. That way they can get to loan money at a reduced cost and the consumer will then reap the benefits. So either that we now have longer tenure mortgages that are single digit rate and easily accessible beyond what NMRC is trying to do or we can have developers who would be able to gather their projects into a portfolio and be able to access funding for construction and so cost of construction will not be so high and back to back they will be able to release the housing units to the consumers through an on lending arrangement such that consumers too are able to access much more easily than it appears or exits now because we can’t expect that foreign investors will come and help us out of this, they will come here to make their own money also. So their cost and funding cannot be as cheap and we also have the volatility of exchange rate to deal with whenever you are dealing with foreign currency denominated loans.”
So internally, we have over 4trillion or so sitting in pension funds, and that is huge. It can do something and it is also an ongoing thing. Every month most employers remit money. So we can look at how people are treating the pension funds, are they paying? Are they remitting? So that we can even have much more and whatever is there now can be channeled to this areas where we need the money the most.
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