Federal Government recapitalises FMBN with N500 billion

Babatunde Fashola‎, minister of Power, Works and Housing said the federal government has concluded plans to recapitalise the Federal Mortgage Bank of Nigeria (FMBN) to a N500bn capital base, which would enable it play a more determinant role in closing the housing deficit in the country.
The FMBN current capital base is currently put at N2.5 billion, of which the federal government has only paid N1.5 billion of its obligation.

Fashola was speaking on Thursday in Abuja at BusinessDay Real Estate Roundtable and Exhibition event which has the theme: ‘Innovative Housing Finance Model as a Catalyst for Homeownership’.
The minister said the plan would create more opportunities for Nigerians earning a living to own a home.
The federal government plans to ensure it delivers affordable housing to millions of Nigerians.
“The housing problem must not define us but must challenge everyone to contribute by building to cut down the much-bandied figure of housing deficit,” he said.

“Nigerians must be ready and committed to closing the deficit gap at all levels. If 52 of us in this conference resolve to do something and not just talk about the problem, the deficit would gradually drop, even with the huge effort the federal government is addressing the housing deficit”
He noted that the government has commenced a National Housing Pilot Programme in 34 states of the federation to address concerns of affordability, acceptability and access.

“Every other administration has had a one form of housing programme or the other, and it is these two government that came up with this programme on a national scale,” he said.

Fashola also pointed out that the Shagari housing programme was not a perfect one, adding that it’s imperfection and ‎successes are serving as a laboratory for the current National Housing Programme of President Buhari currently ongoing in 34 states of the federation.

On some of the concerns of the Shagari housing programme, he said,”We found out that in some cases, people did not occupy those houses. In the first quarter of this year, I still received later from people informing us of their desire to take over those houses.”

He stated further that,”One of the key concerns we identified is that we built uniformly for diverse people and we are addressing that. We have called a meeting asking key stakeholder: what is affordable? What is the building type acceptable in the North-East, in the South West, and others.”

“From the consultation we had with them, we designed the pilot phase for our programmes. The designs are mainly one-two,and three bedroom housing units, and suggestions of building them differently to respond to the cultural needs of such person,” Fashola said.

‎”We have asked the states to give us between 5 -10 hectares of land for a pilot project.”

“It is ideal to have everybody housed, but we must begin re-defining our targets, defining also what is affordable, what people can pay for and what people really want as their choice.”

‎”Everybody deserves a decent shelter that is ideal, but not everybody can afford to buy a house. We must refocus our discussion on this stance” he adds further.

Speaking further on housing demands, he said,”Where is the demand for houses most pronounced. Is it in the villages in urban center. It is in the urban center because the rate of migration outstrips the capacity of building commensurate house.”

“The construction work currently ongoing in the country has increased the demand for building materials, comprising mainly of limestone, rods, laterite among others. ‎If constructing activities stimulating these economic activities in these sites to continue, people are likely not to return to Urban cities.

“Based on the current economic policies of the Federal Government based on agriculture, mining and infrastructure renewal, there is a slow down in rural-urban migration.

“People who used to lease out their own land for farming, have gone back to use their own land for farming for rice, and wheat. Most of these people are likely not coming back to the city.”

Fashola remarked further that part of the reason why ‎there are some challenges of empty houses in the country is that most of them were built on assumption of what people really want.

He said,”Part of the reason for most empty houses is majorly because people do not like what we have built. We have built on an assumption of what people want. We may have built without considering people’s needs and even cultural leanings which also affects the choice people make.

He also pointed out that the pilot construction currently ongoing in the country would assist in identifying a model for acceptable b Nigerian people which would trigger sustainability of such houses, as a Nigerian model.

He also explained that the recapitalisation of the federal Mortgage Bank of Nigeria would serve as a catalyst for the federal government in achieving some of the set targets in addressing concerns of housing deficits in the country.

Frank Aigbogun, Publisher and the CEO of BusinessDay Media LTD said,”As a media house, we cannot leave behind those who cannot meet up easily with housing issues. This is why we must keep bringing these issues at the front burner.”

While quoting Paul Coury, an Economist, the publisher said,‎”There is indeed no reason why Nigeria as a country could not properly mobilise its housing sector for the expansion of its economy, just the way Margarete Thatcher was able to use the council house in the United Kingdom to crystallise the economy .”

Credit: BusinessDay