Some experts in the built environment in Nigeria have contended that mortgage financing is yet to take off in the country, noting that to even describe the sector as emerging is a misnomer.
Speaking at a forum recently, Mr. Akin Olawore, an estate valuer and Principal Partner in the firm of Akin Olawore & Company, noted that mortgage financing is neither just emerging nor in its infancy in Nigeria, asserting that the sector has not yet taken off. “Let me be frank with you, we don’t have any mortgage system in Nigeria so you can’t be talking about an emerging sector or one in its infancy,” he asserted.
In his submission, there cannot be a viable mortgage system without a secondary mortgage market that would buy from the primary market. He noted that this is not yet the case in Nigeria where funds available from the primary market are not sufficient for the secondary market to buy from.
Olawore affirmed that in spite of the moves by the Central Bank of Nigeria (CBN) to reform the mortgage sector, there are not enough funds being injected into the sector to assist in driving it. He recalled that the CBN in 2006 introduced some measures to reform the mortgage sector in 2006 with the aim to galvanize it over a period of five years, noting however that the move could not achieve the desired result due to the quantity of funds at the disposal of the operators in the industry.
In the same vein, Chairman of the Nigerian Institute of Architects (NIA), Lagos State Chapter, Mrs. Abimbola Ajayi, said that her first reaction to any talk on mortgage financing is always to if there is anything like that in place in the country. “Quote me, there is nothing like mortgage financing in the country as far as I am concerned.
What we have in place cannot be regarded as mortgage financing,” she said. Ajayi declared that what is being practiced by the Federal Mortgage Bank of Nigeria (FMBN) as mortgage financing is simply “cash and carry.”
According to her, instead of the so called mortgage banks giving out mortgage facilities to individuals to purchase their own houses, they rather build houses with prices ranging from N30 million to N40 million.
She said that in developed climes such things don’t happen, adding that most house owners purchased their houses through mortgage. She urged the government to put in place a more viable and sustainable mortgage system.
Photo: Mortgage pix2a & Mortgage pix2b
Caption: Houses under private development