The housing gap in Nigeria has increasingly become a concern to not just ordinary Nigerians nor the government, but also to real estate experts in the last few years. This is as experts have opined that the value of the opportunity available to investors in the country’s real estate market ought to be leveraged accordingly.
This indicates a financial implication on both the side of the government and private sector towards achieving a common goal that could ensure average Nigerians of modest homes.
Speaking at the on-going Africa International Housing Show in Abuja, some experts have reportedly stated that there is a rising need for the country to invest in the sector as this would spur efforts toward closing the housing gap which is estimated at 20 million units.
According to the experts, Nigeria is still struggling to overcome an age-long housing challenge with its ever-increasing population, currently estimated at 220 million. This population grows at an annual rate of 2.4 percent while Nigeria’s housing gap is estimated at 20 million units.
In lieu of these, alongside the country’s effort towards urbanizing, experts at the on-going Africa International Housing Show in Abuja have recommended a N5.5trillion investment in the sector to close the gap, adding that Nigeria also needs to build about 550, 000 housing units annually for the next decade to be able to bridge the gap.
This comes after the United Nations projection that unless something is done urgently, about 60 percent of the country’s population will be living in the city by 2030.
In a keynote address at the function, Nigeria’s minister of housing and urban development, Ahmed Dangiwa, stated that Nigeria needs to urgently do something substantial about the prevailing housing deficit in the country, adding that while the government’s plan to deliver 50,000 units is ambitious, it pales into insignificance when compared to the 550,000 units required annually.
Dangiwa explained that the gap can be considered as both a social necessity and a business opportunity that could be utilized by both the government and the private sector.
He urged investors and partners to participate through Public-Private Partnerships (PPPs) and collaborations with housing development finance institutions, noting that the government is making efforts to address the country’s housing challenge.
Dangiwa recalled that the ministry recently adopted a demand-driven approach for its Housing Delivery Strategy to avoid issues of abandoned or unsold buildings as he revealed that just recently again, an online housing portal was launched to streamline the process of acquiring homes.
He stated that the platform has thus far, recorded over 28,000 applications since its inception, describing it as a worthwhile initiative that emphasizes the unbeatable value of data and a needs-based market-driven approach to housing delivery.
The minister further reiterated the aspirations of his ministry’s Urban Renewal and Slum Upgrade Programme which he said has several projects ongoing in 26 sites nationwide.
He added that the ongoing programmes are aimed at providing essential services such as water supply, solar streetlights and road rehabilitation to the beneficiary communities, while expressing the ministry’s quest for partnerships that will help scale the component and improve living conditions for millions of households.
“In alignment with President Bola Tinubu’s Renewed Hope Agenda, the Ministry is working to establish a National Social Housing Fund (NSHF) to ensure all Nigerians, including vulnerable and underprivileged groups, have access to decent accommodation.
“Potential funding sources for NSHF include budget allocations, tax incentives, private sector donations and corporate sponsorships,” he said, adding that efforts were ongoing to implement a national land registration and titling programme in partnership with the World Bank.
“This initiative aims to increase land formalisation from less than 10 percent to 50 percent over the next 10 years, facilitating better housing development,” Dangiwa stated.
He also called on the stakeholders, housing development institutions, and corporate organisations to submit partnership proposals, stressing the importance of finding practical solutions for those living in informal settlements and without adequate housing.
Also, in his keynote address at the housing show, chairman of the Opening Ceremonies, Matthew Ashimolowo, emphasised the urgent need to bridge Nigeria’s widening housing gap while citing the United Nations’ recommendation to adopt Sustainable Development Goal 11, which aims to provide high-quality, reasonably priced homes for all by 2030.
“According to the World Bank, Nigeria will need to construct around 700,000 housing units annually for the next 20 years to meet the needs of its growing population. This ambitious goal requires an investment of N59 trillion,” he stated.
Ashimolowo, a real estate investor with nearly 40 years of experience in various sectors, including agriculture, commercial, residential and land banking.
The former preacher shared his insights on the theme of the conference: ‘Financing the Housing That We Need,” stressing that finance is central to housing and real estate development.
He also described real estate as a ‘financing game’ while highlighting the International Finance Corporation’s (IFC) estimate that Africa’s housing deficit stands at over 97 million units, a figure expected to rise with population growth and urbanization.
Ashimolowo, while proposing ‘land banking’ as an effective financing strategy, wherein developers purchase land at relatively low prices, secure the title and wait for its value to appreciate before selling at a profit, stated that the strategy can is eligible to generate significant funding for current and future housing projects, providing a pragmatic solution to the high cost of financing in the current environment.
According to him, the exact deficit figure for Nigeria remains controversial but that a recent report also revealed that the country was in a dire state in its public housing system.
Ashimolowo further urged stakeholders to be intentional, innovative and pragmatic about their financing strategies to address the housing deficit effectively as he underscored the critical need for collaborative efforts and innovative solutions to tackle the housing challenges facing Nigeria and the broader African continent.
On his part, Nigeria’s Senate president, Godswill Akpabio, represented by the senator representing Anambra Central, Victor Umeh, also emphasised the fundamental right to housing and the need for effective regulation to ensure construction integrity.
Recall that in 2023, Dataphyte Nigeria, in its statistics, reported that Nigeria has an estimated 28 million housing deficit, indicating that the country needs at least 28 million housing units to provide adequately for the population.
According to the report, an estimated sum of N21 trillion was required to provide housing units to fill the deficit as the real estate sector needed an investment of over N21 trillion to build sufficient housing for the entire population. The research organisation further revealed that by the annual average rate of N7.47 trillion credit to the real estate sector, it will take an estimated three years to provide 28 million housing units for the population.
