By Modestus Umenzekwe
On Thursday, 23rd November, 2023, the former Minister of Works and Housing, Babatunde Raji Fashola (SAN) was the Special Guest at the 50th Anniversary of Federal Housing Authority (FHA).
To refresh our memory, the FHA was created by law which came into effect on 1st October, 1973 with the functions of the Authority being the preparation and submission from time to time to the Government of proposal for national Housing programmes; the making of recommendations to the Government on such aspects of urban and regional planning, transportation, communications, electric power, sewage and water supply development as may be relevant to the successful execution of housing programmes approved by the Government; the execution of such housing programmes as may be approved by the Government, among other responsibilities.
Of course, the issue of housing in Nigeria has become a huge challenge not just for the citizens alone, but also to the government. To the people there are so many things associated with the ability to obtain or build affordable houses, such challenges as poor economic condition, cost of building materials, land availability, among others. On the part of government, there are also issues of prioritising and managing available scarce resources in the midst of competing demands making provision of mass housing for the citizens a bit of a herculean task. Land availability is also an issue to government. Therefore, it becomes a serious challenge to build houses that are decent and at the same time affordable.
In is keynote, Fashola delivered a paper titled ‘The Future of Housing in Nigeria and 50 Years of FHA: A Call to Action for Political Leaders and Policy Makers for Decent and Affordable Housing’.
The former Governor of Lagos State said the anniversary should be an opportunity to look forward and to ask what the next 50 years holds in stock for FHA and the way forward.
For the Fashola these issues of decent and affordable accommodation are possible with the right housing policies towards ensuring decent and affordable housing to majority of Nigerians.
A man who believes in practicality and whose leadership in Housing sector for over eight years was phenomenal; he made suggestions as to how practicable it is to realise mass housing especially giving the right financing, housing types, affordability, people’s participation and maintenance, among other suggestions.
He made it clear that perhaps, unknown to members of the public, the resources available for housing at the federal level are insignificant and not proportionate to the expectation of the people. He called for adequate funding towards ensuring that commensurate and substantial funding is available for housing delivery generally and to FHA and allied agencies particularly.
Not minding the challenges and obstacles faced by the authority, Fashola was able to suggest to the agency ways the Federal Housing Authority can raise funds to make more housing available to Nigerians. He said “As owners of very large estates, and vast tracts of land which are very valuable assets upon which financing can be raised, the Authority is in a vantage position to enhance affordable housing for Nigerians.
“I hold the view that if these assets are properly valued, titled and managed they can unlock vast financial resources for FHA to build more estates, sell or mortgage them, recoup the outlay, pay off any debts, and make profit. In this way, FHA can become a proper business run on very strict corporate governance principles that conform with global best practices and this will be consistent with previous attempts to commercialise or privatise the authority.”
According to Fashola if private organisations are buying land at open market value, building on them and scaling for profit, nothing stops FHA which already owns vast acreages of land from competing successfully in this space except FHA herself.
He said no doubt, the FHA has demonstrated its capacity to build and manage estates in FESTAC, Gwarimpa, Zuba, Guzape and such other estates as Bwari still under development.
Part of the challenges faced by Nigerians in realising affordable housing include the type of houses that FHA chooses to build which most times poses a challenge to the buyers because the houses are either too large, some out of reach, making it difficult for the actual category of buyers from accessing them. He spoke on corporate governance and the role of public officers in the sale and acquisition of FHA houses and the type of houses that FHA chooses to build. Speaking on the latter issue of type of housing in relation to whether FHA can successfully sell, he said FHA should recognise that the market demand is probably dominated by those in the age bracket of around 25 to 35 years and it would be helpful for FHA to conduct a highly professional survey of what their needs are before designing and building. This, according to him, is very instructive with the abundant evidence of empty and unoccupied houses, partly accounted for by the fact that they are no longer fit for purpose and market based on design.
He also looked at the payment mode, how can we get affordable houses for our teeming majority? In this regard the learned SAN urged FHA to factor in digital platforms for advertising, sale, and payment as the language of present class of buyers, because if FHA expected these class of buyers to go to their offices to come and collect forms to buy houses and go through some of the ancient red tape that time has tied away for FHA, then there is a risk to success.
Fashola as an advocate of affordability which he has consistently supported has remained unchanged. He said housing is a product that must respond to the realities of the economy such as demand and supply, inflation, interest rates and exchange rates. He said “Therefore, while there is scope to reduce cost of housing delivery by research, materials innovation; affordability is a two-way street not a one-way one. In the first part it is influenced by how much the house is built for, also how it is paid for.”
One of the clogs on the wheel of affordable housing is the payment mode, and that is why Fashola, in trying to marry issue of Cost and Affordability together maintained that the cheapest house can be unaffordable to the income group it is built for if it has to be paid for at once while the most expensive house can become affordable if payment is spread over a reasonable time.
Using Lagos as example of a workable housing policy he said, “The Lagos housing programme which I superintended as Governor, delivering 200 units of housing monthly for three years with a 10-year single digit mortgage payment, had no affordability issues for the income bracket it was built for.”
Admitting the sad but painful truth that not everybody will be able to afford to buy a house, he argued that rental housing is the best way to achieve affordable housing; “I strongly believe that rental housing for all is possible, not only based on how we build but also how people pay rent.”
The former Minister stated that homelessness is the most undignifying experience for a human being and must be confronted with the necessary resolve by political leaders and policymakers. “Therefore, our housing policy must focus on rental as it focuses on ownership. Consequently, rent to own initiatives that started in the last administration must not be allowed to die. Instead, there is scope in my view for improvement in expanding rent to own schemes at Federal and State levels, and also increasing advocacy for state legislators to make laws that make the payment of rent convenient and convergent with wages and salaries.”
He also advocated an end to the era of 2-3 years rent payment in advance “One of the pillars of President Tinubu’s economic policy is the creation of credit to finance basic needs. He started with the student loan policy on education, and it is my view that this ministry can deepen the expectation of Renewed Hope by leading the advocacy with states to end the era of 2-3 years rent payment in advance. It is the antithesis of affordability.”
He also encouraged Nigerians to maintain what has been built. “Nothing built by man lasts forever, but restoration, repairs and maintenance certainly help to preserve, not only design life of buildings, but their utility, value and liveability.”
Fashola encouraged the authority to leverage on an Executive Order Number 11 for National Infrastructure maintenance which was signed on Wednesday 6th April 2022 in the last administration.
He said FHA can leverage on the Order to preserve the value of all her assets and to create sustainable jobs for artisans and professionals who run small businesses. “Going forward, all FHA estates must incorporate maintenance contracts, paid for by occupiers to cover painting, repairs, restoration, waste management, water supply and power supply to mention a few.”
