Owning a home is a universal aspiration, an essential step toward independence and stability in life. However, in Nigeria, the journey to homeownership is often fraught with challenges. Despite the government’s efforts to provide housing solutions, many Nigerians remain unaware of the opportunities and access to loans available through mortgage institutions.
The Federal Housing Authority (FHA), a wholly owned agency of the Federal Government of Nigeria, was established vide Decree 40 of 1973 now cited as Act CAP F-14 Laws of the Federation of Nigeria 2004. This year, 2023 marks the 50th anniversary of the establishment of Federal Housing Authority. The organization came into existence through the provisions of Decree No 40 of 1973 as a Federal Government parastatal, under the supervision of the Federal Ministry of Works and Housing.
FHA started operations in Lagos in 1976, when the then Military Government of Nigeria decided to set up an agency that would manage the accommodation built to host the participants of the Second World Black and African Festival of Arts and Culture, FESTAC, which the country hosted.
The mission statement for the Authority as enumerated by the TCPC is to “pursue the objective of developing affordable housing facilities by organizing an efficient utilization of available resources as provided for in the National Housing Policy.
It is pertinent to state here that the Federal Housing Authority created under the Second National Development Plan in 1973 to coordinate, drive and execute Government Housing Agenda to the low, medium and high income groups has over years pursued this mandate despite huge challenges and the wide gap that still exists between housing needs and supply.
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Since inception, the Authority has had 26 Chief Executives with Mr. SPO Fortune Ebie as the first General Manager. In 1993, Engr Abubakar Aliyu Yabo became the First Chief Executive with the title of Managing Director.
These functions have also been further expanded. The Authority has also been further empowered under the 2012 National Housing Policy to. Provide sites and services for all income groups with special emphasis on the No-income and low-income groups.
Pursuant to the re-defined roles of FHA, the Federal Government, through the Technical Committee on Privatization and Commercialization (TCPC) now Bureau of Public Enterprises (BPE) entered into a Performance Agreement with the Federal Housing Authority.
Pursuant to the re-defined roles, the National Council on Privatization in May 2013, approved FHA’s commercialization. The aim was to reduce the magnitude and scope of financial support of the Federal Government and allow the Authority to adapt to changing business requirements.
The Federal Housing Authority has a major role to play in our ‘Renewed Hope Agenda’ for housing and urban development. So, getting FHA to fulfill its mandate is a priority to us. We will encourage the Authority to operate optimally.
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As an agency that is not on the budget, we will strengthen FHA to be able to source private sector funds -locally and internationally - to drive its operations. What I want the FHA to know is that being partially commercialized and not being on the budget is a good thing.
FHA will also play a key role in our New City Development Plan. Here the Ministry plans to lead partnerships with the private sector, local and international investors, towards redefining the concept of cities in Nigeria and decongesting city centers and state capitals in line with the Renewed Hope Agenda of Mr.
Under Phase 1 of the Slum Upgrading Programme, the Ministry plans a total of 26 sites nationwide. This includes four (4) sites in each of the six regions of the country totaling twenty-four (24) and two (2) in the FCT.
In line with the Renewed Hope plan to ensure that all Nigerians including the NO INCOME, vulnerable and underprivileged groups have access to decent and dignified accommodation, we are also creating the framework for the establishment of a National Social Housing Fund (NSHF).
We have also prioritized building materials manufacturing in the country. This will ensure economic growth, create jobs, and reduce dependency on imports. To ensure success, we have composed a Building Materials Manufacturing Task Team comprising of experts and representatives from relevant government agencies, academia, professional bodies, and industry associations. They will conduct a thorough assessment of the current state of the building materials manufacturing sector and produce a strategic plan for reforming the sector for implementation. We plan to inaugurate the Team very soon.
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To increase the stock of housing supply, we have also composed and will inaugurate a Multi-Agency Project Delivery Team. The Team will ensure that all housing agencies including FHA work together towards optimizing their strengths to increase the stock of quality houses to Nigerians.
The Renewed Hope Cities will have inclusivity at their core: They will include Multi-Level Flats to cater to low-medium income earners; Terrace and Detached Bungalows and Duplexes for the high-income earners.
As the Minister of Housing and Urban Development, I am ready to provide the necessary leadership that is required to move FHA forward.
We are also working to implement the much-needed reforms that will ensure quick, easy, and efficient access to land.
On policy implementation we have called up and met with the FMDQs on the National Housing Strategy (NHS) that was launched in May this year.
In line with our policy of building on existing knowledge so we can move at a faster pace to deliver value, we invited and met with the Presidential Technical Committee on Land Reforms. And I must say that it was a wise decision to do so. This is because we now have access to the comprehensive work they have done over the past 14 years on Land Reforms in our country. Immediately after the meeting we set up an Internal Ministerial Committee to review and recommend for inclusion in our land reforms strategy relevant parts of their recommendations.
As part of our plans to ensure that housing agencies under the supervision of the Ministry are optimized to deliver on our target of providing affordable homes to Nigerians, we have composed a Housing Reform Team of experts, stakeholders, agency representatives, professional bodies, and academia to develop a robust framework for reform of the housing sector including thorough review of relevant laws and facilitation of necessary legislative amendments.
I believe that the reforms and legislative amendments that the Housing Reform Team will execute in collaboration with stakeholders and the National Assembly will be the most comprehensive set ever done in the history of housing and urban development in Nigeria.
What we need at FHA is leadership that is visionary and can innovate, think outside the box, while tackling problems.
His leadership is gradually re-setting Nigeria on the path of sustainable growth and economic prosperity. It is this sort of leadership that Mr.
So, today, we are celebrating the Renewed Hope for the Federal Housing Authority.
We can do this because we have a President who is a gamechanger.
FHA is the one agency that has the license to play in all income segments, so the ministry expects the FHA to make judicious use of this advantage in the broad strategy of the government to deliver housing to Nigerians. I want to see the FHA go to the capital market, issue bonds, and raise funding to deliver mass housing projects across the country, market them, payback the loans, and declare profit.
However, as in most countries of the world, the bulk of housing provision remains outside the public sector. It has been reported that a large percentage of rental housing units in Nigeria which provide accommodation for majority of city-dwellers belong to the informal private sector (Salau, 1992). In Nigeria today, public housing accounts for only 10% compared to nations like Singapore where public housing is put at 90%.
The potential of the real estate sector in Nigeria is yet to be adequately developed and creates opportunity for investors in the areas enumerated above.
Real estate contribution to Nigeria’s GDP is put at 1.64%. It supports all business ventures from the small business requiring office space to the major conglomerates requiring factories.
An overview of Nigeria real estate will not be complete without the mention of land. Land though not finite, constitutes 20% of the whole surface of the earth. It is a significant index for measuring man’s wealth and plays a central role in the development of man’s economy.
The Public Land Acquisition Act and eventual Land Use Act of 1978 helped the acquisition of large tracks of land - mostly untitled and vest all lands in the country to the government.
This sector has two major group ends namely the “high end area” and the “low end area”. The high end area comprises of investments of very high value and development predominantly driven by well established corporate bodies, while the low end area is the reverse which are driven by investments from individuals and few corporate bodies.
The Nigerian real estate sector is still grossly underdeveloped due to limited or non-existent institutional framework.
Mortgage financing in Nigeria began in 1957 with the establishment of the Nigerian Building Society (NBS). Initiated by the British colonial rulers, this marked the start of structured housing finance in the country.
The Nigerian government later bought the Nigerian Building Society, transforming it into the Federal Mortgage Bank of Nigeria (FMBN) to better facilitate housing finance.
Officially established on July 1, 1977, the FMBN took over the assets and liabilities of the NBS, which was dissolved.
During the consolidation phase, the government created the Ministry of Housing, Urban Development, and Environment, along with the Federal Housing Authority (FHA), to further boost housing supply.
Various measures, including the provision of financial resources to federal and state governments and the establishment of self-help homeownership programs, were introduced.
Initially known as the Nigerian Building Society, FMBN was established in 1977 and remains a pivotal institution in Nigeria’s housing finance sector.
Mortgage banks in Nigeria primarily provide loans for purchasing, constructing, or improving residential properties.
The FMBN facilitates housing finance by increasing long-term capital mobilization and lending volume.
A mortgage is a type of loan in which real estate or property is used as collateral. The borrower agrees to repay the lender over time, typically through regular payments that include both principal and interest.
Mortgage banks or other financial institutions provide these loans to help individuals buy or maintain homes or plots of land.
The most common types of mortgages in Nigeria include conventional mortgages and fixed-rate mortgages.
Conventional Mortgages: These are traditional loans that are not insured or guaranteed by the federal government.
A significant player in the mortgage banking sector, FBN Mortgages Limited offers a wide range of mortgage and real estate finance solutions.
Founded in 2002, Infinity Trust Mortgage Bank has been dedicated to providing fast and reliable mortgage services.
Abbey Mortgage Bank Plc is one of Nigeria’s leading primary mortgage institutions.
Mortgage institutions in Nigeria are crucial for facilitating homeownership. These institutions operate under strict regulations to ensure transparency and reliability.
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