A recent report states that the Nigerian Federal Government would have to inject $363 billion (N111 trillion), to meet the current demand for housing in the country. Nigeria’s housing deficit is estimated anywhere between 17 – 20 million units.
This is a staggering amount of money and it begs the question – Is this a realistic endeavor? Does the federal government have enough gumption to make this a reality?
Housing , can be argued to be a fundamental human right, and I think the government should do its fair share to help provide resources, facilitate, and encourage the production of the needed housing units, but is this the sole responsibility of the government?
Private Sector Investment
To ensure that Nigeria’s massive housing deficit is met, the private sector needs to be fully engaged and ready to make this a reality.
In conjunction with the government, private sector companies and individuals can expect to help make a dent in the deficit and also make good returns in the process.
Good government housing policy as well as access to capital will be crucial if this is to be achieved. If private individuals and companies have access to funds (via loans), this will spur them into action and development.
Nigeria’s mortgage sector needs to take off before any real talk of local private investment is to take hold nationwide – we need the input from the middle class to help anchor the housing market.
Public Private Partnerships
The ongoing example of Public Private Partnerships (PPP) can be seen in the Eko Atlantic enterprise. This massive endeavor is expected to cost upwards of $6 billion (N2.2Trillion). The success of this project lies directly with the PPP, and this could be a model to be replicated nationwide.
A key indicator of this success would be how much international investment arrives, as well as local investment – stay tuned.
With the daunting housing deficit weighing heavy on Nigeria’s shoulders, serious, ambitious efforts need to happen – fast. It is not enough to have the one or two high profile projects to highlight – real impact can be made state by state, city by city, and by individual investors.
There is great opportunity for real estate investment in Nigeria and radical measures need to be taken. Lets get serious about affordable housing, lets look at alternative construction methods, such as compressed earth construction as we highlighted in a previous article. With a holistic approach, we can slowly shorten the housing deficit, house by house.