Building 24 million houses by 2028: Examining Tinubu’s ‘Real Estate Manifesto’

In October 2022, before the elections, Estate Intel founder, Dolapo Omodire, examined in detail the manifestos of the three leading candidates in an article titled “Atiku, Obi, or Tinubu – Who is better for Nigerian Real Estate?”. With Ashiwaju Bola Ahmed Tinubu emerging as the President-Elect, we present Mr Omidire’s detailed examination of the manifesto of the winning candidate….. 

Mortgage and Consumer Credit Reform 

• The various federal agencies meant to promote homeownership are too small and fragmented. To address the housing deficit, Tinubu plans to ensure greater cohesion and efficiency by merging these agencies into a new, more competent body. This new entity will inherit the functions of existing housing authorities and shall be adequately capitalised by the Federal Government.  
• The agency will have a three-fold mandate to (i) grant low-interest-rate mortgages directly; (ii) guarantee qualified mortgages issued by banks; and (iii) purchase mortgages from private banks.  
• The guaranteeing and purchasing of mortgages will incentivise banks towards mortgage lending and will deepen the secondary mortgage market. Tinubu’s ‘Real Estate Manifesto’ · Banks will also be encouraged to engage much more in the provision of affordable consumer loans for automobiles and expensive domestic appliances. A certain portion of bank lending must be earmarked for the consumer. All non-compliant banks will pay a penalty to the government. Compliant banks will be entitled to tax breaks and credits as well as favourable treatment by the CBN regarding inter-bank transactions and other monetary policy ratios. 

Home Ownership 

• Homeownership is a source of prosperity, social stability, and individual pride. A vibrant residential construction industry is essential to a healthy modern economy. 
• In conjunction with the National Assembly and State Governments, the plan is to review and revise the Land Use Act. 
• Streamline and rationalise the land conveyance process. In this way, the plan is to lower costs and delays and promote more efficient use of land. This more efficient allocation will bolster the housing industry and lower costs for investors and consumers. 
• Working with State Governments, the intention is to provide credits and incentives to developers of housing projects that set aside a significant portion of their projects to affordable housing. With the support of State and Local Governments, TInubu’s team aims to establish and implement a new social housing policy whose objective shall be to provide pathways for the poorest Nigerians to climb onto the housing ladder. 
• Establish a coherent federal program to provide eligible and meritorious civil servants with federal payment mortgages for their homes. 
• Tinubu’s plan also includes a chart that references a cumulative addition of 24 million housing units by 2028. Where 4 million housing units are added every year from 2023. 

Estate Intel’s Synopsis Of Tinubu’s ‘Real Estate Manifesto’ 

• Reform of the Land Use Act 

Tinubu’s plan demonstrates an understanding of the existing structure with specific references to the major issues affecting the property market, the first being the Land Use Act of 1978. The explicit intention to work with the National Assembly and State Governments to rectify title issues and make crucial updates to the Land Use Act will make any real estate professional excited. If the right reforms are made on the Governor’s involvement in the process, inconsistencies within the act, alongside greater clarity on farmland, the impact on the property market will be notable.  

• Amplification and Improvement VS. New Ideas? 

Some of the other ideas, however, build on already existing structures available at a national level or within Lagos specifically. While not exactly the same, the Lagos HOMS aims to accelerate growth by providing affordable mortgage finance and thereby promoting equal access to home ownership in Lagos State. Ideas around the establishment of a coherent federal program to provide eligible and meritorious civil servants with federal payment guarantees for fixed-rate, longterm mortgages for their homes, appear to be a ‘Federalisation’ of what has been a relatively successful program within Lagos State. One does worry, however, if amplification or improvement of existing schemes and plans is sufficient to truly push the needle and give Nigeria the change it needs. 

• Collapsing NMRC, FHA, and Others into One Master Agency 

Finally, the plans to collapse ‘various federal agencies’ that are ‘too small and fragmented’ most likely speak to institutions such as the Nigerian Mortgage Refinance Company and the Federal Housing Authority. The tasks each of these organisations have been given are large and there might be a case for consolidation for efficiency. Without any indication of how this will be implemented, however, it is difficult to see how this will work in practice