How FMBN can boost housing stock, by professionals
With Nigerian mortgage industry entering a new era in which efficiency, speed and the customer experience will be more crucial than ever, housing professionals have urged the new helmsman of the Federal Mortgage Bank of Nigeria, (FMBN) Ahmed Dangiwa to focus on cheap and long term funds, with low digit interest rates and longer debentures.
They believe that housing could be the game changer for the beleaguered economy, if the government supports the sub sector. In a healthy market, housing makes up roughly 20 per cent of Gross Domestic Product (GDP) through home buying and consumption spending on housing services.
Speaking to The Guardian, the President, Association of Consulting Architects of Nigeria, Mr. Kitoyi Ibare- Akinsan, advised the new FMBN to concentrate on its lending limit, which should be at least N30 million for residential mortgage, while the interest rate for residential mortgage loans should be subsidized by the Federal government so that it is not more than five per cent.
Akinsan’s view is that the present situation is not doing a lot of good for envisaged reduction of the nation’s housing deficits. Similarly, the President, Association of Town Planning Consultants of Nigeria (ATOPCON), Olaide Afolabi said FMBN must strive to go for loans that are between 25-20 years duration with a low-interest rate.
For the Vice President, Nigerian Institute of Building (NIOB), Mr. Kunle Awobodu, more efforts should be concentrated in tackling the bottlenecks associated with access to mortgages.
The present situation, he said, is cumbersome and inimical to the intention of establishing the bank in the first instance. While calling for fairness on the part of administrators, Awobodu also want the FMBN boss to work with other professional bodies in the built environment if the vision of reducing the nation’s housing deficits is to be actualised.
Also development expert and Project Director, Arctic Infrastructure, Lookman Oshodi, was more concerned with the ability of the new banks’ helmsman to deliver considering his background as an architect.
According to him, since the FMBN is currently having a liquidity issue, the priority should be mortgage originations, settlements and refinancing.
He explained that as an architect, Dangiwa might be challenged because the job requires more of a man with the knowledge of banking.
Oshodi expressed fears that with his background, the focus may be reduced to construction issue and how to deliver housing, which however could only happened when there is money.
For the Managing Director and Chief Executive Officer of Realty Point Limited, Debo Adejana, the new helmsman must clean up the FMBN books, especially as it concerns the Estate Development
The developers noted that there are a lot of unhealthy issues on the EDLs, which has remained a virus in the system. Adejana also stressed the need for the bank to re strategise in its operations in its dealing with various geopolitical zones by giving each zones attentions, depending on the level of their contributions
According to him, the system is not fair because some people are benefiting more than those that are contributing more. “There are complaints and they need to be equitable in their operation.