Possible growth initiatives for housing finance in Nigeria

33 total views, no views today

Unemployment and high level poverty are two major obstacles to getting housing finance in Nigeria. Poverty level in the country is high despite the country’s apparent wealth from petro-dollar. This is made worse by rising unemployment figures in excess of 20 million.

Africa is regarded as a poor continent and, despite its relative large population size, the continent is economically underweight with an estimated €113 billion gross asset value of real estate which represents 1 percent of the world’s total value.

A World Bank report once estimated that only 3 percent of the African population, about 15 percent of the world’s 7.3 billion population has income viable enough to qualify them for a mortgage. This explains the need for initiatives that can lead to viable income to qualify people for mortgage.

That estimate simply underscores the level of poverty in the black continent where some households live below poverty line. Home ownership in most parts of Africa remains a luxury because houses are literally unavailable and where they are, they are inaccessible and unaffordable.

In Nigeria, the continent’s most populous nation and one touted as its largest economy, it is estimated that 70 percent of country’s over 180 million people lives below poverty line, which is the reason for the low home ownership level in the country that is a little above 10 percent.

It is also estimated that about 90 percent of houses in Nigeria are self-built with less than 5 percent of them in possession of formal title registration. Because of this, mortgage loans and advances in the country stand at 0.5 percent to GDP in contrast to 30-40 percent in emerging economies and 60-80 percent in advanced economies.

Adigwe Arinze of Homebase Mortgage Bank attributes this to hostile business environment and lack … Read More...

Fresh challenges in housing market as landlords seek agreement, commission fees outside terms

37 total views, no views today

The lack of sufficient and pocket-friendly accommodation in most Nigerian cities has left many home-seekers at the mercy of some landlords who, according to BusinessDay checks, are taking undue advantage of the challenges in the country’s property market.

Some house owners in the busy mainland of Lagos and Port Harcourt are said to be enacting new terms of renting apartments to prospective tenants that are unfavourable to estate agents and their clients.

BusinessDay survey revealed that some landlords who have highly sought-after apartments with cheaper price ask potential tenants to pay legal (agreement) fees to them instead of a lawyer and the commission which is also supposed to be the agent’s fee for initiating the transaction is split to give a share to the house owner.

“What happened before now was that the lawyer from the landlord was entitled to the agreement fee while the agent was given the commission but now the landlords are taking half of the commission and sometimes more than half coupled with the agreement as they no longer use the services of lawyers and no written agreement is given other than a receipt,” Ade Usman, a real estate agent in Yaba, told BusinessDay.

According to the middle-aged man who gets most of his clients from an online platform, the landlords’ recent behaviour is as a result of the fact that “they feel if  one agent doesn’t collect the amount he is given, another agent will.”

He attributed this to the increase in the number of agents now scrambling for the same business. “These days, anyone can bring a tenant to a landlord and claim that he/she is an agent and is willing to take any amount, thereby stirring unhealthy competition in the market.”

Agency fees are not illegal as some …

Hope dims on housing roadmap as Buhari’s 1st tenure nears end 

48 total views, no views today

A very robust roadmap on housing was one of the early policies and programmes of the Muhammadu Buhari administration that Nigerians, especially those in the low-income class and still in the housing market, welcomed with high expectations. But as the clock ticks for the end of Buhari’s first tenure, these expectations are waning. The roadmap,…

This content is for Standard Bi-Annual, Premium Bi-Annual, Standard Yearly, Premium Yearly, 2 Weeks FREE plan, Standard Bi-Annual USD, Standard Yearly USD, Premium Bi-Annual USD, Premium Yearly USD, BusinessDay/Ready Set Work Premium Yearly (FREE), 2 Weeks FREE plan (Flutterwave), 2 Weeks FREE plan (Paylater), 2 Weeks FREE plan (Union Bank), 2 Weeks FREE plan (NAIJASTARTUP), Premium Yearly (Union Bank), 2 Weeks FREE plan (She Leads Africa), 2 Weeks FREE plan (PiggyVest), 5 Days FREE plan (Flutterwave) Test and N99 Free Trial members only. Visit the site and log in/register to read.

Source link