The Minister of Housing and Urban Development, Ahmed Dangiwa, has urged mortgage banks to adopt rent-to-own mortgage options and flexible monthly mortgage loan repayments as strategies to develop innovative mortgage products and make commercial loans more affordable.
He also urged all bank CEOs to ensure that Nigerians within the low and medium-income segments have access to affordable mortgages.
According to him, business owners should not see the provision of housing and home loans from a business and profit motive, but as a moral imperative to reduce the number of homeless persons.
The minister gave these recommendations while delivering his keynote address at the 20th edition of Mortgage Banking Sub-sector CEO’s Annual Retreat held on Saturday, in Abuja.
The event organised by the Mortgage Banking Association of Nigeria provides a platform for CEOs of Mortgage Banks, Brokerage Companies, Statutory Regulatory Bodies, Policy Makers and other housing industry stakeholders to discuss sector challenges to produce clear recommendations that border on effective housing delivery in the country.
Speaking in his address, Dangiwa noted problems inhibiting the growth of housing finance, mortgage adoption and housing delivery in the country and stressed the need for innovation and creativity to implement solutions at every point in the value chain.
Recalling issues discussed during his stint as the Managing Director of the Federal Mortgage Bank of Nigeria, Dangiwa lamented unresolved constraints bedevilling the sector since the retreat began 20 years ago.
He said, “I am pained to note that the same problems that have been militating against the growth of housing finance, mortgage adoption and housing delivery in this country are the same ones that still plague the sector today.”
“You will agree with me that not much has changed. Most of these problems are still with us. This emphasises the need for all players to find ways to navigate the macro, legal and policy bottlenecks. The need for innovation, creativity and effective leadership at every point in the value chain. Leaders are supposed to navigate the complexities of situations to make progress.
“So, while the government works to fix this macro-economic challenge, I still believe that as CEOs of mortgage banks, you can still find creative ways to develop innovative mortgage products that are responsive to the current state of Nigeria’s economic situation. This includes adopting rent-to-own mortgage options, and flexible monthly mortgage loan repayments to make commercial loans more affordable.”
He added that with the incentive of long-term funds in the capital market, mortgage refinancing must be deepened to unleash the potential of the housing market.
“I note with concern that the Capital Market has not been maximally tapped to raise long-term funds to refinance mortgage loans and to explore more creative ways to make mortgages more affordable even as we work to fix the larger macro-economic problems.
“As leaders, we must not only see the provision of housing and home loans from a business and profit motive but also see expanding access to affordable mortgages as a moral imperative. So, we must do all we can even in these difficult times to ensure that not only the elites, but Nigerians within the low- and medium-income segments have access to affordable mortgages,” he added.
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