The Ondo State government has disbursed N604 million to commence the first phase of a 454-unit housing estate in Akure, the state capital.
Commissioner of Information, Ranti Akerele, disclosed that the proposal for the project, to be built on a 312_plot layout, was approved by the State Executive Council, as a follow up to the deal sealed with two mortgage firms, namely: Aso Savings and Loans Plc and Lockhomes at the inception of the Dr. Olusegun Mimiko administration in the state last year, to provide houses that would be made available to buyers through mortgage financing.
He noted that large expanses of land located at Oba_Ile and Oda Road, two settlements on the outskirts of the state capital, were made available by government to the two developers who moved to site following groundbreaking ceremonies performed by the governor.
Akerele recalled that the last time such an extensive housing development scheme was recorded in the state wasÂ during the administration of Late Chief Adekunle Ajasin in the Second Republic when the Ijapo and Oba_Ile Housing Estates were built in Akure.
To facilitate the involvement of public servants in the acquisition of the houses when completed, The commissioner asserted that the state government has released N17.5 million as the first quarter tranche of housing loans for public officers, to be repaid with an interest rate of six percent.
State CommissionerÂ for Lands and Housing, Alhaji Sikiru Basaru, remarked that the funds for the housing loans was from the pool of N70 million which has already been set aside for that purpose in the 2010 budget, adding that a disbursement committee involving all stakeholders will soon be set up for that purpose.
Basaru, however, noted that out of the combined total of 350 units for the two sites, only 35 are nearing completion even though the units have been fully subscribed with many would_be owners ready to deposit for subsequent batches, raising doubts about the capacity of the developers to deliver the houses within the stipulated time.
The reforms in the banking sector has obviously impaired the ability of banks to release loans for capital_intensive and long term financing of the property market had affected the projects.
The commissioner however justified governmentâ€™s decision to go into direct construction, declaring the problems with the existing arrangement, which he identified as inadequate funding and defects in agreements, were being sorted out.
â€œThere was a hiccup in the earlier Memorandum of Understanding (MoU) signed with the developer.
We had to go back to the drawing board when the firm said it could not sell at the price government proposed if it was going to provide municipal facilities. We have since taken up the burden of provision of municipal facilities so that the units can be in the price range that would be affordable by the people of this state,â€ he said, adding that they are going back on site soon.
He said government has already acquired and approved the layout for the project, which is located about half a kilometre from the existing site at Oda Road with capacity to accommodate 454 housing units when fully completed.