News Column

NHF - Another Boost to Housing Finance

July 17, 2014

Bamidele Ogunwusi

In a move seen as a way of reducing the housing deficit in the country, which has been put at about 16 million units and stirring up the provision of affordable housing, the National Housing Fund (NHF), a special contributory scheme supervised by the Federal Mortgage Bank of Nigeria (FMBN), where civil servants in the country contribute 2.5 percent of their monthly salary, last week scored another goal as FMBN delivered a 324 units housing estate built from proceeds of the fund in Enugu. Our Correspondent, Bamidele Ogunwusi, reports.

The administration of President Goodluck Jonathan last week again restated the determination of the present administration in providing quality and affordable shelter to Nigerians as the President commissioned a 324 units housing estate fully financed by the Federal Mortgage Bank of Nigeria ( FMBN) in Enugu.

Represented by the Vice President, Namadi Sambo, President Jonathan said the present administration is mindful of the need to accord priority to housing sector due to the importance of the housing sector to the socio-economic development of any nation as it constitutes an important element of job and wealth creation.

Jonathan described the commissioning of the estate named Elim, as another visible and verifiable pointer to the success of housing delivery initiative the present administration commenced about four years ago.

He expressed delight at the commissioning of the estate which was financed by FMBN using resources of the National Housing Fund (NHF) scheme and developed by NBP Projects Limited.

According to him "It is remarkable that to enable the scheme cater for affordability issues of individuals, the estate offers 1 bedroom, 2 bedroom, 3 bedroom units among others at affordable price to low and medium income earners.

"While commending the developers for prudent use of the resources, I wish to say that this commissioning signifies the usefulness of synergy and corporation between government and private sector. It underscores the effectiveness of the NHF as a veritable source of long term funding and justifies the need to strengthen the scheme through the recapitalisation of FMBN

" Also, the Nigerian Mortgage Refinancing Company (NMRC) which was launched last year will bridge the cost of residential mortgages, stimulate availability of good houses to Nigerians and reducing affordability and gaps to finance"

In his speech, Managing Director of FMBN, Gimba Ya'u Kumo, commended the present administration on its efforts at providing quality and affordable housing to Nigerians. He expressed delight at the quality of work by the developer and urged others to emulate him saying he has been able to deliver the project in record time and at required quality.

These developments affirm the tangible achievements of the Transformation Agenda in the area of providing affordable housing for Nigerians throughout all the geopolitical zones of the country.

The construction of the FMBN Elim Estate was financed from the limited resources of the National Housing Fund Scheme which comprises mainly of 2.5% of the monthly income of workers nationwide. The estate was financed through a construction loan to the developer, NBP Projects Limited, who has delivered a total of 324 units which are for sale to NHF contributors a affordable costs.

The estate comprises 128-one bedroom terrace units selling for N3.5 million each, 32 two bedroom terrace units at the cost of N4.5 million each, 89 two bedroom blocks at the cost of N5.8 million each and 75 three bedroom bungalows attracting N10 million each. All housing units are delivered with high quality finishing in addition to accompanying infrastructures of a good road network, electricity, sewage and other facilities to guarantee a comfortable and decent environment for the prospective estate residents.

Kumo said that in line with Mr. President's Transformation agenda and the desire to provide affordable housing to Nigerians, the FMBN has commenced the packaging of mortgage loans to NHF applicants in Enugu State to purchase these houses adding that low and medium income earners who qualify to own the houses based purely on the basis of being regular contributors to the NHF Scheme will enjoy mortgage loans that attract a single digit interest rate of just 6 percent and are repayable for up to 30 years.

The concessionaire terms of the loans he said, are in conformity with the directive given to the bank to provide Nigerians access to cheap funding for owning their own houses.

Kumo commended the Enugu State Governor, Sullivan Chime who he said demonstrated confidence in the NHF scheme and championed the resumption of contributions by public servants in the employ of the state government to the NHF scheme.

" It is in view of the resumption of NHF contributions that FMBN offered the Enugu State government a N2 billion estate development loan to be drawn down through Kelloyds Holdings, a private estate developer, to develop additional houses for the state public servants. This arrangement has received approval of the Honourable Minister of Lands, Housing and Urban Development and FMBN has commenced processing of the estate development loan for the Enugu State Government in this regard" he stated.

He commended the President on his remarkable achievements in recent times noting that the achievements are being consolidated upon despite the challenges of land acquisition and absence of long-term funding which the present administration is effectively addressing.

The occasion afforded the FMBN the opportunity to touch on the thorny issue of lack of funds as the MD disclosed that with the 2.5 per cent deduction from workers salaries, the bank has been finding it very difficult to carry out its obligations and therefore requested for more funding.

" If you look at the minimum wage of 18, 000, the deduction is 2.5 per cent. If you run your numbers, it is about N450. We have 3, 777, 000 contributors. It takes 250 contributors contributing N500 monthly for 10 years for one person to be able to access N15 million.

"That is the statistics and that is why we are talking to government to fund us, even if it is a low interest loan for a long tenure. By the time you run a mortgage for five years, it is not a mortgage. A mortgage should run for 15 years or more" he said.

Kumo said that what this means is that an average Nigerian can identify a house in any location in Nigeria and approach FMBN for a loan through a PMI for financing for either outright purchase or for renovation.

The MD commended the developer, Ugochukwu Chime for delivering the project in under 22 months instead of the expected 24 months saying that the developer has become a reference point to other developers through his consistent demonstration of professionalism, timely completion of projects and high quality of work.

Also speaking , Governor Sullivan Chime of a Enugu state commended President Jonathan on the landmark successes the present administration has recorded in the housing sector in the last few years.

He said that apart from keying into the Federal Housing Scheme, his government was partnering with the private sector to provide quality and affordable houses for its workers.

While assuring of his readiness to continue partnering with the Federal Ministry of Land, Housing and Urban Development in that regards, he disclosed that "I have directed the relevant agencies of government to expedite action on the ministry's request for land to provide a similar estate.

He urged states to collaborate with ten private sector to Providing houses to Nigerians as the federal government alone should not be made to bear the burden.

" that is why we released the land for this housing project as it signifies a right step in collaborating with the private sector to providing housing for our people. Housing provision is very important and that is why we have made huge investments in the sector" he said.

"Here in Enugu State, we have fully developed six estates and all of them are occupied. We found time to commission the Maryland Estate, which contains 384 Units, fully developed".

The Governor, however, observed that since it could not meet the housing needs of the people alone, it had continued to partner with reputable estate developers, noting that "Elim Estate is a clear example of such partnership".

He equally described the developer, Rev. Surveyor Ugochukwu Chime as a rare achiever and called on other contractors and developers to emulate the rare standard he had set.

The Chairman, Senate Committee on Housing, Dr. Buka Abba Ibrahim, in a goodwill message at the event disclosed that the National, Social Housing Bill would be passed next week "so that the federal government can mobilize to build houses not just for the rich but for all levels of people in the country".

The Managing Director, COPEN Group, Rev. Ugochukwu Chime, in his address, disclosed that the 324 Elim Estate consists of 75 number of 3 bedroom detached bungalow, 89 number of 2 bedroom semi-detached block of flats, 32 number of 2 bedroom in Terrace and 128 number of 1 bedroom Terrace.

The Estate, according to him, equally contains a perimeter fencing and police post, tarred access roads, dedicated 500 KVA transformer, water reticulation, indoor sporting facilities and a shopping centre.

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Source: AllAfrica

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