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Mr Chuks Omeife is a former President of the Nigerian Institute of Building. In this interview with DAYO AYEYEMI, he speaks on how Nigeria’s low income group can be accommodated adequately, by adopting the Malaysia’s model.
WHAT is special about Malaysia’s affordable housing model you talked so much about during your tenure as President of Nigerian Institute of Building?
A study tour of the Malaysian housing policy many years ago by the Nigerian Institute of Building shows an initiative that combines quality, quick delivery process and affordability in housing provision and delivery. The model, which is the initiative of government, is a structured mixed housing development. In this initiative, the policy is designed to create a robust and interactive housing estates where both the high income earners, middle income earners and the low income earners live within a layout. The affordability aspect is designed in such a way that the high income/middle-income earners subsidise the purchase of low-income earners or group making their price very affordable. In a typical land layout, the development model is mixed to accommodate all strata of the society. Government as the initiator of the development provides land free to developers who designed various house types with compulsory 30 per cent of the layout earmarked for the low-income group. The initiative is designed with human face and with the government living up to its responsibility of providing affordable housing for the people. The government and the developer agreed on price for the low income earners based of the price placed on the luxurious house type for the high/middle income group.
Can this model works in Nigeria?
This model can work here in Nigeria if there is sincerity and government’s readiness to provide the enabling environment for housing development. Developers are not allowed to have a field day in terms of pricing as adequate feasibility and viability study is carried out to enable developers to break even and realise marginal profits on their investment. This is unlike in Nigeria where developers have to buy the land, provide infrastructure and build the houses. In such situation, government cannot moderate pricing in an investment that it has contributed anything to. Even in some cases where government provided land, the insincerity on the side of both government and the developers has made prices of housing to be unaffordable to the majority of the people.
What about the issue of finance, mortgage?
Despite the high cost of houses developed in Nigeria, there is no adequate mortgage system that can facilitate housing purchase for people. This had slowed down the development of housing which has accumulated over the years causing the high deficit in national housing stock.
What about the issue of high building materials’ cost?
However, the issue of housing affordability is a play or interaction of many factors, which includes majorly the low percentage of the local component content in housing development. Unfortunately as at today, majority of input component into building construction are imported especially the finishing materials. The few components that are locally produced are not optimally produced, hence the high level of importation of building components, which sadly have flooded the building materials, market across the country.
What are things the government and stakeholders, comprising developers, professionals, local building materials manufacturers would have done better and failed to do?
The general government policy in the real estate sector are haphazardly formulated without one being an input into another. Yes, there is no fantastic implementable government’s housing policies that has been put in place. The challenge is that these policies are standing on their own. Policies are supposed to be progressive and connected so that the deliverables or output of one becomes an input for another. That is the only way the various policies put in place can make an impact. A typical example is how we encourage local production of building materials without a policy to restrict the importation of similar material just like the mouthed backward integration that was executed on some products in the manufacturing sector. It is this progressive formulation of policies and their connectivity that all stakeholders should advocate for in the industry. As it is now majority of finishing materials used in the real estate are imported unfortunately at the detriment of local production. It is by putting together all these policies collectively that all the stakeholders can move the real estate sector forward.
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