Mass Housing: Expert Advocates Subsidised Mortgage Lending Rates

A real estate expert, Mr Fortune Ebie, has called on the Federal Government to subsidise interest rates on mortgage loans to ensure mass housing.

Ebie, a former board member of the Federal Mortgage Bank of Nigeria (FMBN), told the News Agency of Nigeria in Lagos that such a development could achieve the single digit interest rates in the sector.

He said that another way was by issuing bonds through the capital market.

“If bank lending rates are between 14 and 15 per cent, government can decide to permit mortgage institutions to lend at between 8 and 9 per cent.

“Those differences can now be given to the mortgage institutions in form of grants. This is the practice in many countries,” he said.

Ebie said that estate developers had been advocating for this for a long-term, but government had not responded positively. He said if government could subsidise agriculture, fertiliser and holy pilgrimages, it could as well subsidise housing.

“The attitude of government and its advisers is that they would not subsidise housing in any way and this attitude will continuously subject Nigerians to homelessness, perpetual poverty and housing chaos,” he said.

Ebie said that for bonds to achieve this purpose, government must also give concessions to banks and mortgage providers to enable them subscribe to them.

According to him, when FMBN bond was floated, it enjoyed a lot of waivers from government but regretted that it was limited to houses in Abuja.

He said that for mass housing to be effective and for mortgage institutions to play their roles the regulations should be extended to all the states in the country.