Reps propose new rules to regulate real estate sector

The House of Representatives has proposed a new regulatory framework for Nigeria’s real estate sector to address institutional gaps, protect homebuyers and attract investment.

The proposed National Real Estate Regulatory Authority (NRERA) is expected to strengthen oversight, promote transparency and establish standards for property developers and other industry operators.

The Chairman of the House Committee on Housing and Habitat, Abdulmumini Jibrin, disclosed this yesterday in Abuja at a stakeholder conference on the proposed authority.

The conference had the theme, “One Vision, One Ecosystem, One National Housing and Real Estate Plan.”

Jibrin said his committee’s assessment of the sector revealed regulatory weaknesses, overlapping responsibilities among government agencies, and inadequate consumer protection.

He noted that several institutions involved in housing development operated outside the direct supervision of the Ministry of Housing and Urban Development, resulting in gaps and duplication of responsibilities.

“There are enormous challenges. We have a wonderful Minister of Housing. But as the Minister of Housing of the Federal Republic of Nigeria, he does not have jurisdiction over all the agencies and institutions that have to do with housing.

“There is a link; there is a gap. So, there is duplication of functions,” he said.

The lawmaker noted that the absence of effective regulation had allowed some individuals to collect money from prospective homeowners without adequate checks on their credentials and capacity to deliver projects.

He, however, said the proposed framework would also address the responsibilities of homebuyers, noting that some people entered into housing agreements without properly considering their financial capacity.

Jibrin explained that inflation, policy changes and rising construction costs could affect developers’ ability to complete projects under their initial agreements.

He said the proposed authority would establish clear standards for operators, provide dispute resolution mechanisms and strengthen accountability across the industry.

The committee chairman also maintained that the legislation would complement existing institutions rather than take over their statutory responsibilities.

He assured state governments and professional bodies that the proposed authority would respect their constitutional and legal mandates.

“We are not going to compete. We are only going to cooperate,” he said.

Jibrin described the proposed legislation as an intervention to address longstanding regulatory deficiencies and unlock the sector’s economic potential.

In his remarks, the Minister of Housing and Urban Development, Dr Muttaqha Rabe Darma, said the Federal Government was intensifying efforts to address structural and institutional challenges in the housing sector.

Darma recalled that the ministry organised a similar stakeholder engagement in July to examine the country’s housing deficit, which estimates put at more than 15 million units.

He expressed concern over the low level of mortgage penetration in Nigeria, despite its estimated population of 240 million.

“Our population, as of today, is estimated to be about 240 million. But, as speakers after speakers mentioned, mortgage penetration is very low.

“It is less than 10 per cent, as against 38 per cent in Malaysia and 40 per cent in South Korea,” he said.

The minister stated that the country had the Federal Mortgage Bank and other mortgage institutions, but their activities remained inadequate to meet housing demand.

According to him, the built environment and real estate sector ranked as the third-largest contributor to the Nigerian economy.

Darma expressed support for the proposed authority, saying it could improve coordination in housing development, property investment and mortgage financing.

He, however, urged stakeholders to consider placing the authority under the Ministry of Housing and Urban Development to ensure alignment with existing government policies.

He cited Singapore, Dubai, Malaysia, the United Kingdom and Rwanda as examples of jurisdictions where similar regulatory institutions operate within ministries responsible for housing and the built environment.

Also speaking, the Managing Director and Chief Executive Officer of the Ministry of Finance Incorporated, Dr Armstrong Ume Takang, urged stakeholders to examine the proposed legislation’s relationship with existing laws and institutions.

He identified the Land Use Act as one of the key areas requiring careful consideration.

Takang also cautioned against excessive regulation that could discourage private investment or increase government expenditure.

“How do we create this new agency and fit it into the existing structure of government in a way that we do not expand the recurrent expenditure framework of government?” he asked.

He assured participants that the Federal Government was willing to work with stakeholders to develop a transparent and sustainable real estate sector.

In his keynote address, the Speaker of the House of Representatives, Tajudeen Abbas, called for a centralised and digital property administration system to simplify transactions and improve confidence in the real estate market.

Abbas said Nigeria needed a reliable digital system linking property ownership records with the identities of owners, buyers and sellers.

He explained that such a system would help tackle fraud, multiple ownership claims and disputes associated with land and property transactions.

In his address titled, “Building a Trusted and Investable Nigerian Real Estate Market,” the Speaker said the country’s housing challenge was not necessarily a shortage of properties but a lack of confidence in the market.

“Nigeria does not lack property. Nigeria lacks enough trust in property,” he said.

Abbas maintained that effective regulation would protect legitimate businesses, discourage fraudulent practices and encourage long-term investment.

The proposed authority is expected to provide a coordinated regulatory framework, strengthen consumer protection and promote professional standards in Nigeria’s real estate sector.