By YINKA KOLAWOLE

The Nigerian Mortgage Refinancing Company (NMRC) has signed a Memorandum of Understanding (MoU) with a US-based investment firm, Cantor Fitzgerald, for the investment of $1bn (about N200 billion) in the Nigerian mortgage sector. Cantor Fitzgerald is a global private investment firm with strong expertise in asset-backed mortgage securities. The firm has also made arrangements to build 10,000 houses in Kaduna, Lagos, Enugu and Abuja within the next one year.

Finance Minister, Okonjo-Iweala
Finance Minister, Okonjo-Iweala

Speaking at the signing ceremony in Abuja, last week, the Coordinating Minister for the Economy and Minister of Finance, Dr Ngozi Okonjo-Iweala, said the entry of such an important player into Nigeria’s mortgage sector will boost the prospect of achieving the core vision of the NMRC which is to get young Nigerians convenient access to the means of owning their own homes.

The minister described the MoU as a very significant moment for the country, noting that the mortgage sector has a huge untapped potential. She noted that the mortgage sector in other climes remained the engine of the economy because of the huge job opportunities and its multiplier effects.

“Cantor Fitzgerald’s presence in Nigeria shows that our mortgage strategy is attracting the right kind of attention from the right kind of people around the world and this will deepen and diversify and ultimately reduce the cost of mortgage and housing in Nigeria,” she said.

Managing Director of Cantor Fitzgerald’s Investment Bank, Mr. Jack Hefferman, said his firm was fascinated by Nigeria’s steady progress in the mortgage  market, hence the need to bring liquidity to Nigeria to deepen the mortgage market. According to him, the double digit interest on mortgages currently applicable in Nigeria would gradually give way to single digit as liquidity increases in the system and more houses are made available. “NMRC is exactly the right business model to bring liquidity to Nigeria’s housing sector.

I have been in the mortgage sector for about 30 years in the U.S. When I first started interest rate was 12 per cent and over 30 years, it has dropped to four percent. Nigeria can experience same,” he declared. Hefferman further disclosed that the land for the housing units in the four pilot states has been acquired, adding that that works on designated sites would commence in April this year, starting with Lagos State.

naira
naira

In his comment, Chief Executive Officer of NMRC, Prof. Charles Inyangette, said the signing of the MoU marked another significant step by the federal government to change the face of the housing sector in the country. He said that NMRC has fully commenced operations, having received its licence from the Central Bank of Nigeria (CBN).

Meanwhile, giving an update on applications for mortgages under the NMRC, which opened last year, Okonjo-Iweala noted that that out of 66,000 applications received, 25,000 had been pre-qualified, 9,000 had been given offer letter, while monies have been disbursed to 33 Nigerians to acquire their homes.

She further disclosed that a number of other initiatives were being worked out with the National Pension Commission (PenCom) to enable workers borrow from their Retirement Savings Account to own houses. She added that efforts were also in the offing to collaborate with the Central Bank of Nigeria (CBN) and other agencies to expand the housing market.

Disclaimer

Comments expressed here do not reflect the opinions of vanguard newspapers or any employee thereof.