The Government of Lagos State, Nigeria’s most populous city, the second fastest-growing city in Africa and seventh in the world with an estimated population of 21 million recently signed a landmark Memorandum of Understanding with the Nigeria Mortgage Refinance Company Plc (NMRC), Nigeria’s foremost Mortgage underwriter on the delivery of 20,000 housing units, under the State’s Lagos Affordable Public Housing (L.A.P.H.) initiative, to help bridge the housing gap in the State.
The Memorandum of Understanding (MoU) executed on 23rd of October 2017 marks the beginning of a partnership which will avail citizens of the State the affordability and accessibility that NMRC provides through the refinancing of long-term mortgages.
The partnership with NMRC also includes Ibile Holdings Limited, the State’s investment company as well as some developers engaged by the State through direct and Joint Venture Initiative to deliver 20,000 housing units to the state government by 2018. The Developers partnering with the State government and NMRC are Brains and Hammers Limited, EchoStone Development Nigeria Limited, Industrialized Mass Housing Development Company Limited, Multi-Purpose Infrastructural Development Construction Limited (MIDC) and Tact-Urban Infrastructure Developers Limited.
In his address, the Honorable Commissioner for Housing of the State, Prince Gbolahan Lawal, stated that in furtherance of the Lagos Affordable Public Housing (L.A.P.H.) Initiative of the Governor Akinwunmi Ambode’s administration geared towards the construction of 20,000 housing units through Joint Venture Initiative (JVI), the Ministry is working on various modalities to ensure accessibility of the citizenry to these housing units.
He noted that in the build up to this event the Lagos State Ministry of Housing has had eight formal meeting, starting from 21st February 2017, and almost twice this number in terms of informal meetings and other correspondences.
He further noted that considering the prevailing economic situation in the country which has affected the finances of most citizens and their ability to personally fund the purchase of a home, the Ministry and the Developers have initiated an arrangement with Primary Mortgage Institutions (PMI) and Nigeria Mortgage Refinance Company (NMRC) to facilitate the creation of mortgages for subscribers to the housing units under the initiative.
He added that the State Government is a subscriber to Nigeria Mortgage Refinance Company (NMRC) by virtue of the registration of its Lagos Building Investment Corporation (LBIC) with the Company and is therefore qualified to benefit from the mortgage loan refinancing roles of Nigeria Mortgage Refinance Company (NMRC).
The Honourable Commissioner said that the Lagos Affordable Public Housing (L.A.P.H.) home ownership initiative and this collaboration is an opportunity for the State and its citizen to leverage on the benefits available under Nigeria Mortgage Refinance Company (NMRC) and that the refinancing agreement will assist the supply side as well as the demand side of the value chain as it will set in motion a revolving pool of funds for mortgage origination which will assist developers and provide them access to construction finance and help scale up housing delivery.
He said it will also avail citizens of the State the affordability and accessibility that NMRC provides through the refinancing of long-term mortgages thereby unlocking its multiplier effects on the State’s strong economy, including jobs and wealth creation. Examples of these efforts, said he, include the effective re-positioning of housing provision institutions in the State and the successful implementation of the Rent-To-Own scheme which has driven the growth of the sector and enabled many Lagosians, as a matter of fact over 2,000 Lagosians, realize their dreams of affordable home ownership.
In concluding, he said “I feel very delighted and particularly excited that the Memorandum of Understanding that will trigger a program that can be tagged “HOME OWNERSHIP MADE EASY”, I repeat “HOME OWNERSHIP MADE EASY”, is about to be signed. I make bold to say that by this singular step Lagos State under the administration of Governor Akinwunmi Ambode has taken another giant step towards making housing readily available and accessible for the citizens of Lagos State”.
According to Professor Charles Inyangete, Managing Director/Chief Executive of NMRC, today (23rd October 2017) marks a watershed moment for NMRC. He said that the signing of the MoU is a journey on the path to making homeownership for Nigerians a reality alongside Lagos State.
He noted that Lagos State itself is at the frontiers and indeed at the leading edge of making homeownership a reality and creating the enabling environment for business to invest in housing and the signing of the MoU is on the path to doing that.
Adding that as part of this MoU Lagos State will be embarking on ensuring that titles exist for the properties and the land on which the development will take place and done timely, with Lagos State committing to allocating to Developers appropriate land for the purpose of the development; while NMRC is committing to stand at the back end of the transaction to ensure that all the primary mortgage banks have funding available for the refinancing of the project.
He said that NMRC has actually done something that comes one step before that; as reported in the BusinessDay of the same day, NMRC is part of what is called the mortgage warehouse fund; that will provide funding for mortgage institutions to be able to actually create mortgages in the first place and it is hoped that this will be part of the process for driving the actualization of that; on the part of the Developers, said Professor Inyangete, there has been the levering of the global technology for the purpose of developing affordable homes in Nigeria
Concluding, he said that this day brings the culmination of all these parties – Lagos State, the driver; the provider of land and titles, NMRC the provider of finance, and of course those without whom we will not be providing financing – the Developers.
In responding on behalf of the Developers, Mr. Adebola Sheidu, Chairman Brains and Hammers Limited, said that hard work and cooperation of both the public and the private sector is required in order to tackle the issue of housing deficit in Lagos State and Nigeria as a whole.
He noted that construction of houses has never been the major issue facing Developers, but delivering affordable homes.
On a final note, he said that the event is not just the signing of some documents, but a marks major breakthrough for the housing sector in Lagos State and Nigeria as well.