Housing Will Help Jump Start The Economy – Afolayan

Chief Olabode Afolayan is the Chairman of Housing Developers Cooperative Society (HDCS) and past President, Real Estate Developers Association of Nigeria (REDAN). In this interview he notes that the Housing sector has been identified as a sector that can create a lot of employment for the people and will help jump start the economy.

Read excerpts below:

Now that we are transiting from the monolithic oil economy, what role do you think housing stands to play in the expected diversified economy?

Of course, we have great potential in Nigeria because of our population; a country of about 180 to 200 million people couple with our challenges. All we need to do is to begin to address those challenges with a view to translating them to opportunities. For instance, the revolution in the banking industry was buoyed by the challenges being faced at a time. There were a large number of customers and with little number of branches, and with a lot of queues in the banking halls, the operators had to look inward with a view to deploying technology. That gave birth to the deployment of Automated Teller Machine (ATM) and also gave opportunity to the owner of Inter-switch. The same thing applies to the housing sector. Now that we have come to realise that our sector can create a lot of employments for the people, we need to imbue it with a lot of creativity to increase its viability. With a huge deficit put at 17 million units, operators in the industry need to begin to look at housing structure that meets the need of the people without compromising standard. Governments at various levels can begin to invest in housing and increase the GDP because it is obvious that even if you are building houses for rent or own, you will definitely have returns on your investment over time. It is a sector, we believe, will help jump start the economy. If government is desirous to do anything about the economy, it must start with the housing sector. To what extent would you say governments at all levels are providing the needed environment and the incentives required to enable the industry optimise its potential? In the last two to three years, the revenue that accrues to the Federal Government has gone down tremendously because of the challenges in the global oil market. This has compelled a lot of state governments to begin to look inward by a way of raising bonds. And when they go to the capital market to raise bonds, they need the IGR to pay up. Since they do not have industries to service that, they are now thinking of housing related services. Look at Ogun State for instance, the government started with an encouragement for everyone to obtain land title for a flat rate of N10, 000 and in the process raised a lot of money. The good reasoning in this is that, with several million people having titles, they pay ground rate every year. Riding on the Ogun State success story, a good number of state governors are now opening up more cities. They have come to realize that they can get more money in housing related transactions and that is why the process of issuance of titles has been computerized in most states. For instance, Lagos State started with e-title. Initially they started with about nine people signing C/of/O, but they couldn’t still meet up so they went ahead with the e-title. Kwara State Government also recently started giving people options to fast-track the process of insurance of titles with an extra payment. With title, it makes the product transferable, liquid or it makes you comfortable that you have an asset that you can pass on to the next generation. It is clear that the sector with the highest investment destination at this period of time is housing. Whenever construction is taking place, a lot of housing related materials are usually in demand. It has sprawling effects on the manufacturing, agriculture, mining and financial sectors.

Read full interview HERE