FG to finance housing construction through extra-budgetary means – Fashola

The Federal Government has said that it would resort to Bonds, Real Estate Investment Trusts and other extra-budgetary measures to provide the funds needed to finance affordable mass housing to address the country’s estimated 17million housing shortfall.
The Minister of Power, Works and Housing, Babatunde Fashola, disclosed this in an exclusive chat with our correspondent in Abuja.
Fashola said, in the medium term, government would raise more capital outside direct Government Treasury, working with the Ministry of Finance, through Bonds, REITS and other forms of real estate finance.
He said funding sources such as pension funds, private equity funds, and the National Housing Fund managed by the Federal Mortgage Bank to finance development and also acquisition would be the focus of the administration.
“For the first time since 2011, the Federal Mortgage Bank of Nigeria has declared a half year surplus of N423,653,187, “he said, adding that the development was against the backdrop of half year losses of N8.6billion; N6.4billion; N1.7billion, N2.1billion and N8.6billion in 2011, 2012, 2013, 2014 and 2015.
According to the minister, the role of his ministry was, “Strictly regulatory, controlling designs, quality of finish, construction methods and materials, guaranteeing off take of any house that private sector can deliver, and strengthening the Federal Mortgage Bank to provide finance to developers and end users.”
He disclosed that the Federal Mortgage Bank recently requested an amendment to the payment process of the equity contribution of prospective home owners to be capitalized over a period, instead of being paid at once “and we have approved this request.”
While acknowledging that there would always be people who would not be able to own homes, but could only afford to rent, the minister said government would improve Rent- To-Own Schemes.
Fashola added that this would revive the culture of public access hostels.