By Victor Gbonegun
Towards promoting increase access to housing finance and responsible home ownership, a new scheme called “My Own Home” coming from the platform of a modeled Public-Private Partnership(PPP) arrangement through Mortgages, Mortgage Guarantee and insurance as well as housing microfinance has been launched for residents in Lagos who hoped for the realization of a dream of their personal homes.. Stakeholders for the
product include the Federal Government of Nigeria, the Federal Ministry of Finance, Central Bank of Nigeria with the $300Million IDA loan support of the World Bank, Federal Ministry of Power, Works and Housing, the Federal Ministry of Justice and Mortgage Banking Association of Nigeria (MBAN). The Mortgage institutions are participating in the scheme through equity stake they took in Nigeria Mortgage Refinance Company (NMRC). The partnership is being implemented by the Central Bank of Nigeria (CBN) through the Nigerian Housing Finance Programme (NHFP). Expectedly, the Apex bank is to provide the enabling environment for
the project while other stakeholders in the housing finance sector would shore up awareness of Mortage, housing micro-finance and consumer protection to guarantee access to the scheme. Consequently the
scheme would scale up mortage and housing finance awareness through mortage literacy, customers’
rights, responsibilities and education. To access the product, customers are expected to first contact any of the “My Own Home” participating financial institutions and those that are not under the model to
mpare rates before aking out a mortgage or housing finance loan that is suitable and in line with their demands.very Nigerian from age 21, irrespective of trade or occupation that meets the borrowing requirements of a mortgage or housing microfinance bank are eligible for the scheme. They are to personally
visit the banks enlisted for the programme for information on how they could explore the opportunity to their advantage. Speaking at a media briefing that was attended by the major key players in the scheme recently
in Lagos, the housing/mortgage finance consultant, Nigeria Housing Finance Program (NHFP),CBN, Mrs. Adenike Fasanya-Osilaja said the initiative has four components which include the refinance product, mortgage guarantee insurance product, micro-finance for low-income earners which allows for incremental development financing and the technical assistant to support people in the industry with training and
literacy. She explained that the product is not a scheme to steal money but to help Nigerians who wants to own a house know about what mortage is all about noting that it is not designed to sell house but to serve as
a catalytic product in jump starting the housing market and
capacitate the banks to give subscribers loans. On the security of the product, she said: “The programme is
industry driven. The
industry is the same irrespective of government and political parties in power.
The scheme does not have its base in social housing and so
sustainability is
assured. The scheme does not discriminate on the basis of
income. If you are able to pay your rent, then, you are able to subscribe to
> the scheme. It is a
> paradigm shift for home ownership in Nigeria and we will
> spread the initiative
> to all parts of the country”.
>
> Expanding on how
> the scheme came to
> manifestation, the Assistant Head of Administration team,
> NHFP, CBN, Mr.
> Jackson Imandi who gave the breakdown of the $300 IDA loan
> said $250million is
> allocated to strengthen the NMRC balance sheet, $25million
> for mortgage
> guarantee, $15million for home microfinance banks and
> $10million allocated as
> technical assistance to the housing finance industry. He
> stressed that for the
> programme to succeed, parties to it must ensure responsible
> lending and
> borrowing simultaneously to prevent hiccups in the
> process.
>
> “It
> is important that we note that this not subsidies, nor
> social housing but a
> commercial transaction where everyone must meet his or her
> obligations. The
> programme involves government borrowing about N50Million
> from the World Bank to
> be paid back over a period of 40years, it is not a grant and
> so the government
> must pay back”.
>
> For the Head, Risk
> Management, Nigeria
> Mortgage Refinance Company(NMRC), Phyllis Uzom, she remarked
> that owing to lack
> of access to long-term funds, most of the mortgage banks at
> best create only
> medium term mortgages which severely constrained mortage
> creation in the
> country. She stated that NMRC has started addressing the
> hurdle through
> refinancing mortgages for long term funding constraints
> hindering the growth of
> the primary mortgage market in Nigeria.
>
> “NMRC
> has put in place standardized lending practice of mortgage
> providers through uniform
> underwriting standards for members institutions and the
> entire mortgage
> industry. It does not give mortgages to individuals or
> organizations; it
> refinances mortgages through “my Own Home” participating
> Mortage originating
> banks. NMRC has been able to provide long term funds that
> could span more than
> 20years, thus improve the capacity of Mortage financing
> institutions”, she
> said.
>
>
> But why the the imperativeness of the
> initiative, President of Mortgage Bankers Association of
> Nigeria (MBAN); Adeniyi
> Akinlusi said economic growth is propelled by the housing
> sector in most
> developing countries because it is the major source of job
> creation which could
> bring about a multiplier effect for the growth of the
> economy. According to
> him, the more money is committed to the housing sector the
> more jobs are
> created for people in the built environment adding that more
> that 60 per cent
> of growth in the Nigerian economy is contributed by the
> informal sector.
>
> “The
> scheme would promote social stability among the millennial
> as everyone would be
> engaged in doing one thing or the other, have a source of
> income and be able to
> buy a house, start a house and would not be available for
> social violence. It
> will create total change, when the market booms, there is
> capital inflow and with
> all the relevant stakeholders working together, we can have
> the Nigeria of our
> dream and intention to own individual homes would be
> achievable”, he explained.
>
> It would be recalled
> that the scheme has
> already taken effect in Abuja some months ago and plans are
> in the offing to
> expand the initiative to other states and geopolitical zones
> of Nigeria. According to the
> initiators, the whole
> idea is to drastically reduce the current humongous deficits
> in the nations’
> housing sector which industrial expert temporarily said is
> about 17million
> housing deficit. Although observers remarked that there is
> 95 per cent
> possibility that this current figure is not statistically
> realistic has the shortfall
> is more than that due to the nations’ geometrical growth
> yearly in population
> without no concrete and attainable plans by government to
> address this housing
> needs of her citizens.
>
> In most Nigerians
> cities, many poor residents
> who find their ways into the city from the rural areas in
> search for lifes’
> survival ended up sleeping daily under the bridges due. Only
> time would tell if
> the initiative would actually helped in addressing the
> urgent demand for affordable
> housing scheme that would not fall into the same category of
> failed efforts
> that were initiated by government and the private sector in
> the past.
>
> Some residents who
> spoke on the scheme
> however expressed fear of keying into the idea. One of them
> is Mr. Sobayo
> Willaims who residents in Yaba, Lagos. According to him,
> there has been a
> similar scheme which he subscribed to some years ago but
> which eventually
> failed due to poor marshal out of the scheme from its
> beginning. Willaim, a
> Civil Servant explained that he would alone subscribe to
> them after watching
> his survival or failure as a non-participant in the next two
> years.
>
> Also reacting, a
> trader, Mrs. Bukola Adeolu
> argued that although the initiative sound so exciting, but
> doubt if it would
> succeed as some Nigerian factors might crumble the entire
> process. For her,
> such factors include, lack of political will to continue the
> programme perhaps
> another administration should come on board in the
> nations’ political process,
> the problem of corruption, Nepotism and inequity amongst
> others.
>
> “If
> only government could be really serious about the programme,
> it sounds so
> lovely at least everybody wants to own his/her home rather
> than being a tenant.
> But for it to succeed and for more Nigerians to buy into the
> idea, there should
> be a law that would back it up, in order to guarantee its
> success”, she stated.--------------------------END------------------------------------
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