By Yinka Kolawole

The mortgage sector is said to account for less than five percent of total funds for housing development in Nigeria.Mr. Sonnie Ayere, a Principal Partner at Dunn Lorren Merrifield and Adekunle Omotola & Co, said this at the recently concluded Kuramo Conference organised by the Lagos State Government, in Lagos, where issues of housing development and options for sustainable mortgage financing in the country were addressed.

He lamented that the mortgage industry contributed less than 0.4 per cent to the country‘s Gross Domestic Product, claiming that it is one of the lowest in sub Saharan Africa. In his words: “Eighty_six per cent of housing fund is from the household stock.

About 10 per cent is from public authorities. The mortgage sector provides less than five per cent of housing fund. This is fueling corruption and is one of the issues to be addressed if we must stop corruption in this country.”

Ayere called for a radical review of the cumbersome land registration process in the country, in general, and particularly in Lagos State, which he noted, makes property transactions difficult and asserted that the creation of mortgages was hinged on the certainty of title to land as mortgage was a creation of secured title.

He urged the government to take a cue from Ghana, South Africa, Egypt, Singapore which have achieved a measurable success in the housing sector.

According to him: “Ghana before now had a dysfunctional land administration; long and expensive procedures that lasted up to five years and involving six agencies supervising land administration resulting in inefficient state land bureaucracy and customary tenure.” He however noted that when the Ghanaian government instituted reforms, property registration was cut to 34 days and queues at the lands commission disappeared, making it possible for the mortgage sector to thrive.

Foremost urban development expert and Chairman, Development Policy Centre, Ibadan, Prof. Akin Mabogunje, said housing required an understanding of the legal foundation to succeed.

“The legal bases for housing development in the country are very difficult. Many of our laws are not very well articulated to make it easy. For 12 years, I have tried to provide housing, but it has not been easy. Now, there are laws. We have amended these laws also. Unfortunately, the laws are still pending before the National Assembly, five years after our work at the Presidential Committee on Housing and Urban Development was completed,” he stated.

In his own contribution, President, Mortgage Banking Association of Nigeria (MBAN), Mr. Abimbola Olanyika, called for the abrogation of the Land Use Act. “Take the Land Use Act away from the constitution and let it be alone. Consent is not necessary. Effective land registry will help in the trading of land as shares.

I will love Lagos State to be the first state to champion this. If you remove the Land Use Act from the constitution and stand it alone, consent will not be necessary. Effective land registry would erode the need for consent and a particular transaction can be registered within three days. In Nigeria, it costs about 17.5 per cent of the land value to register a title while in Ghana it costs as little as 1.3 percent.

“Government cannot deliver the houses, but the private sector can. If these bottlenecks are removed, we can assure Nigerians that the mortgage industry is on top of the task of providing affordable homes for the teeming population of this country,” he declared.