Operators seek African housing finance framework
Fresh building blocks were again laid recently in Nigeria, unto Africa mortgage finance sector, when pan-African housing specialists hold talks to boost provision and expansion of affordable and sustainable financial resources to the continent mortgage industry.
They met at this year’s African Union for Housing Finance (AUHF) conference and 32nd Annual General Meeting in Abuja, co-hosted by the Nigerian Mortgage Refinance Company (NMRC) under the theme: Housing and Africa’s Growth Agenda.
The participants agreed that Africa need to develop a robust homegrown mortgage finance model that is distinct from the global system suits the culture and environment.
AUHF is a member association of mortgage banks, building societies, housing corporations and the like working on the mobilisation of funds for shelter and housing, with the overarching goal of promoting housing finance on the African continent.
The AUHF currently has 55 members from 15 countries: Botswana, Ghana, Kenya, Mauritius, Namibia, Nigeria, Rwanda, Seychelles, South Africa, Swaziland, Tanzania, The Gambia, Uganda, United States of America, Zambia and Zimbabwe.
The Managing Director, NMRC and AUHF Board member, Prof. Charles Inyangete who set the tone expressed concern on the affordable housing crisis in Africa. “We need to address both affordability and accessibility together. The extent of inequality created by the crisis of affordable housing on the African continent is too high a price to pay and we must find solutions to providing access to sustainable affordable housing finance,” he said.
For Inyangete, any solution to affordable housing has to maintain the dignity of the members of the community. “We need to build homes that are durable and will last a long time,” he said.
While stressing that a well-functioning housing market can be a vital economic sector and a potential source of job creation, he added that NMRC is responding to its vision to be the dominant housing partner in Nigeria, by providing liquidity and access to affordable housing finance.
A Senior Housing Finance Regional Lead, Sub-Saharan Africa Financial Institutions Group, International Finance Corporation (IFC), Mr. Thierno Habib Hann stated that housing Finance in Africa offers numerous opportunities for investment, which is good for households, construction industry, financial sector and economy.
He stressed that housing finance is long-term commitment and enabling environment is key for many emerging markets to create unrivalled opportunities; and operators should use a critical is mix of investment and advisory services to achieve sustainable operations and increase affordability.
Hann advised that governments to rationalise the formalization process of customary rights to facilitate access to land; enhancing the capacity of the land administration, sand starting with the support of its computerization. “In exchange for this assistance, and registration charges could be lowered.”
He also recommended for the training of the judiciary, and particularly the new commercial courts, to create awareness of the importance of a well-functioning mortgage enforcement mechanism as well as enacting a condominium and sectional title law to encourage multi-family homes and strengthening debt recovery and enforcement laws (foreclosure and eviction regulations on loans secured by real estate).
Hann wants operators to lower the cost and price of affordable housing; scale up local industries, improve techniques; builders in Nigeria and Kenya to engage in large scale housing projects and reduction in material costs as its very high in Africa compared to China, India, and Turkey: about 35 per cent premium on structural steel, up to 400 per cent on cement.
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