With an estimated four million housing shortage out of a national total of 17 million, Lagos faces a daunting challenge providing accommodation for its growing population believed to be in the region of 20 million. But the state government through its Lagos HOMS programme is determined to correct this short`age by providing decent, affordable housing units to its emerging middle and lower income earners. SEUN AKIOYE reports
Not many people are more optimistic about the capacity of Lagos State Government to deliver what it called “decent and affordable homes” to the city residents than Akinola Kojo-Sagoe. Since February 2014, when the Lagos Mortgage Board (LMB) was inaugurated and he was appointed as the Executive Secretary/ Chief Executive Officer (CEO), Sagoe has consistently been engaged in selling the mortgage scheme to Lagosians.
So far he has succeeded, at least to the degree to which his “products” have been available. Since the Board was inaugurated, it has been given the mandate to administer the allocation of what is now known as the Lagos Home Ownership Mortgage Schemes (LAGOS HOMS).
The vision
Lagos state has a rising profile as West Africa’s commercial capital and an alarming profile as consisting of one of the worlds dreaded slums. Though the smallest in landmass out of the 36 states in Nigeria, Lagos is the most densely populated with immigrants coming from all over the country, in pursuit of happiness and living thereby putting pressure on public infrastructure, especially housing.
The result was predictable, mass slums emerged with residents living in sub human conditions. Housing price also rose with homeowners charging between two and three years rent in advance. Real estate agents also cashed on the jamboree charging exorbitant amount for their services which are usually “compulsory”.
The World Bank says Nigeria has a housing deficit of 17million and Lagos alone accounts for 4 million of that figure. Amnesty International was less charitable describing at least70 percent of Lagos residents as living in slums and unhygienic conditions.
The Lagos state government tried to address some of these concerns with the promulgation of the Lagos Tenancy Law in 2011 which restricted the number of years a homeowner can collect from a prospective tenant in the state. But the law seems ‘too little too late’ as it failed to address the issue of housing shortage. One landlord was quoted as saying: “Government has no right to dictate what I collect from my tenant after all the government didn’t build this house.” He thereafter advised the government to build its own houses where it can foist its own laws.
200 Homes every month
Interestingly that was exactly what the Lagos state government did. In February, when Governor Babatunde Fashola inaugurated the new Lagos Mortgage Board; he made it clear that the mandate was to provide affordable housing for Lagosians especially the first time owners.
”Home ownership has often been regarded as a utopian aspiration for a large majority of our people; a mark of great prosperity and the attainment of significant wealth. As a result, this status brought about by inequality has eluded our people decade after decade.
“We believe that equalizing opportunities will remain the expectation of every taxpayer from a government under any social democracy for generations to come. It is for this reason that our strong determination to provide better access to capital through affordable access to home ownership remains unshaken,” Fashola said.
Lagos has since begun the construction of modern houses across the five divisions of the state. The houses which vary between one, two and three bedroom apartments are built with all modern facilities in place and it is available to any Lagos resident who can show evidence of at least five years payment of income tax and with a reasonable steady income.
There is more good news, the state government, through the LMB will finance the houses for applicants with an irresistible 9.5 percent interest spread over 10 years.
There is bad news too at least for Lagos moneybags. The Lagos Homs scheme is not available for sale to those who have the cash to buy the houses but for those who will like to explore the mortgage route.
“Looking at the housing deficit in Lagos which is about four million, if we must bridge this gap we cannot sell the houses outright or the money bags will hijack it. Governor Fashola has said the houses are meant for first time buyers. We also want to build the mortgage culture, with that you will build up your credit and housing can reach those who still need them,” Sagoe said.
‘Sagoe is of the opinion that Nigerians have to change the cash based mindset which has held the productivity of the people down. “Mortgage increases productivity because you know you have to work. We are starting something new and we need the help of everyone to succeed,” he said.
Sagoe said aspiring Lagos residents can become a home owner in five simple steps. Application and submission; pre-qualification; draw; post draw processing and; the closing. However, the uniqueness of the Lagos Homs is the draw where all eligible applicants who have evidence of tax payment in Lagos for five years will have the opportunity to be picked in a draw that will see them wining a house of their dream.
“There are three draws and your application entitles you to them, so there is every possibility that if you don’t get picked in one draw you will get picked in the next, so the opportunities are limitless,” a staff told The Nation.
There are commitments from the applicants too. For instance, one must be able to provide the initial 30 percent equity fund before the LMB approves the loan to cover the balance on the mortgage. For the houses that have been sold or those that will soon go under the auction, the average price is between N8million and N15million.
There is also the interest rate which some have described as a “little steep” for a government scheme but Sagoe said: “The interest will come down eventually, there can only be a downward movement. We are starting the equity with 30 percent too, the idea is to start off and see how many people will subscribe to it, and this is still the initial stage.”
For those who are unable to put up the 30 percent equity fund, there are other options they can explore says Bayowa Foresythe , the Executive Director, Shared Services at LMB. The scheme is called Rent to Own which affords a couple to rent an apartment in one of the schemes and the equity is built into the rent over a five year period. “When you rent one of the houses what we call rent credit is saved from your rent over a five year period and then you are encouraged to apply for the house. This is the new direction Lagos is going and it is the right direction,” he said.
Currently, there have been seven draws for the allocation of the houses and 443 applicants have won houses with about 273 people fulfilling their obligations and collecting their keys. According to Sagoe, the scheme has delivered 1,400 houses in seven months while contractors are currently working on 23 sites across the five divisions in Lagos. “Our mandate is to deliver 200 houses every month,” Sagoe said.
He said the mandate is to have between 3,500 and 5000 housing units by the end of 2015. “The model now is to work day and night to achieve this mandate.”
A home for taxpayers
It is a fantastic feeling to own a piece of property in Lagos, most residents will agree. Sagoe and Foresythe thought so too. According to them, the scheme which was being funded through taxpayer’s money is a reward for diligent and taxpaying residents of the mega city. “This scheme is being funded by your tax money and only those who pay taxes can have access to it. If more people pay taxes, then we can do more, this is one of the rewards for paying taxes,” Sagoe admitted.
Recently, officials of the LMB went on a three-day tour of all the schemes in Lagos as part of the preparations for the October draw. In Amuwo Odofin where seven blocks of 12 flats are being proposed, work has just begun with the clearing of about three and half hectares of land. Foresythe said the construction will usually take 12 months and it will include a Laundromat, central sewage system. Amuwo Odofin scheme has also been designated as a research centre for the Lagos Homs.
In Ajara Badagry, the scheme is about 60 percent completed. Developed by the New Town Development Authority (NTDA), the scheme has 420 units and would be ready by the first quarter of 2015. Apart from the usual facilities of street lights, individual Laundromats, central electricity and sewage system with interlocking brick roads, the scheme also have the advantage of the lagoon at the back of the estate which may serve as a major transport hub for those coming from Lagos.
But one of the most improved upon is the Igando scheme in Alimosho local government area. Built on the former site of the National Youth Service Corps (NYSC) Orientation camp, the 492 housing unit is a beauty to behold. According to Foresythe, the scheme has in addition to other facilities, a community library, Police post and basketball court.
The houses here too have been great improvements from the initial conception at Shittu scheme. The blocks were properly demarcated giving that exclusive feeling of a stand-alone. The blocks have designated colours which Sagoe said is “playing with colours to make it more vibrant.
“Can you imagine how beautiful this place will be when finally completed?” Foresythe asked lifting his eyes up and spreading a hand around the complex.
On the Island, the team visited the Sangotedo scheme with its 41 blocks of flats and 492 units where ten blocks will be allocated during the October draw. The scheme is of a different architecture complete with balconies unlike the newer schemes in Igando and Badagry.
Sangotedo is divided into two phases, while the first has been at least 90 percent completed, work has already started on the second. “We are working night and day to ensure we deliver a standard housing unit, we cannot compromise on standard,” an engineer on the site said.
There is also the Lekki phase 1 scheme which will have eight blocks of 96 unit houses. Workers are already on site with pilling works beginning. It is estimated to be completed and ready for sale in 12 months. “This is going to be a hot cake when completed,” Sagoe said with excitement.
But one of the most challenging constructions is currently ongoing at Ilubirin which has been termed as the city beside the sea. An ambitious project not only in size, but also in the sheer velocity which involves the reclaiming of 20 hectares of land from the sea to build a 66 block apartment of 1,254 units. According to engineers at Cyron Investments Ltd who are the contractors, the building works which began this in March this year is expected to last for 18 months.
“The work is tough because of the 40-metre pipes that we need to use. If it were raft we would have finished construction but we have standards we cannot compromise,” an engineer said.
Ilubirin is also a wonder of modern engineering. There were cranes lifting heavy metals and trailers discharging cement. It was a sea of workers each deeply involved in different aspects. All around the fresh breeze from the sea provided a soothing relief from the noise of the equipments and to the north is the view of the endless stream of vehicles on the Third Mainland Bridge.
Handled by the Lagos State Ministry of Housing, Ilubirin may in the future become an engineering tourist attraction when fully developed.
But the Lagos Homs project is not only providing accommodation for Lagosians. It is also providing what Sagoe called “360 degree effect on wealth creation.” From the construction to the furnishing of the houses, there has been wealth creation in every sector.
According to Foresythe: “Jobs are being created on these various construction sites that have benefitted over 134 construction companies, 459 sub-contractors, employing over 1,168 persons, seven consultancy companies, over 5,442 suppliers, artisans, labourers and numerous citizens who are employed in the supply chain of sand, gravel, woods and fittings as well as food vendors and transporters.”
In October, another draw will hold and several taxpaying applicants will become home owners. This process will be repeated every month until Lagos state is able to cut the housing deficit drastically.
”Governor Fashola has said the scheme will outlive him so we have no problem about continuity, but the lesson about the Lagos Homs is to pay your tax consistently, then you can also partake in the rewards,” Sagoe said as he moved to begin a round of inspection at the one block scheme in Omole Ikeja.
