September 5, 2011

Expert says low income earners cannot own landed property in Nigeria

Mr Chudi Obosi, a Property Consultant and Managing Partner at Ubosi and Eleh Real Estate firm, says there is no hope for low-income earners to own landed property in Nigeria. Obosi said in Lagos that the current state of the mortgage industry and challenges of the property industry would not make such plans feasible.

“The truth is that TV/Radio/Media advertisements will tell you otherwise, but it is almost impossible for a low-income earner to own a property in Nigeria,” he said. Obosi said that the average loan from the Federal Mortgage Bank of Nigeria (FMBN) through National Housing Fund (NHF) was increased from N5, 000,000.00 to N15, 000,000.00 two years ago. ”

But the conditionalities for accessing these funds are tough, including the required deposit by the mortgagee,” he said. Obosi said that securing loans from conventional financial institutions was even more difficult because they would be based on pure commercial transactions.

“It is unlikely that low income (and middle) earners without multiple streams of income can benefit from or access them,” he said. Obosi said that the property market, like the rest of the economy, was not shielded from the vicissitudes of the nation. “The same reasons why anyone will invest in the Nigerian economy are the same reasons why people will invest in the real estate industry basically because of enabling environment.

“Security of lives and property, infrastructure, absence of justice and equity, unstable and unpredictable government policies and direction are some issues that have to be addressed to attract foreign investments,” he said.