The federal government would give priority to young Nigerians who never own houses in the allocation of the 10, 000 housing units, launched, in Abuja, last Thursday. The Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo-Iweala, disclosed this while explaining how the scheme would work to serve the dual roles of bridging the nation’s housing deficit and creating massive job opportunities for professionals and tradesmen in the building industry.
She said that priority would be given to first – time house ownership applicants and young Nigerian desirous of owning their personal houses who would receive between N 2 million to N20 million. “This scheme is aimed primarily at the first-time home buyers who are desirous of owning their personal homes in which to live.”, she said. According to her, the mortgages would be “to purchase a home costing between 2 million and no more than 20 million Naira”.
Dr. Okonjo-Iweala said that the scheme has been made flexible to accommodate various facility windows such that one could get a house allocated to him out of the housing stock of developers, while others who have their lands could also apply for loans to build the houses on their own or upgrade existing houses. According to Dr. Okonjo-Iweala, the scheme being funded through the Nigeria Mortgage Refinance Company, NMRC, would provide participating Primary Mortgage Institutions, PMIs, with low-interests, long-term funds for onward lending to the Nigerian public.
The mortgage facilities, she explained, would not only attract a low interests but would be re-paid within a period of between 10 to 20 years, as against the current practice where banks and PMIs provide high-interest mortgages and demand re-payment within one to three years. Her words, “the NMRC is set up as a re-financing vehicle set up to provide mortgage lending institutions with increased access to liquidity and long-term funds. “Since the ability of banks to deliver mortgage services is limited by the fact that 80% of all Banks’ deposits are for 30 days only, the NMRC, in ensuring greater access to finance for tenors of up to 20 years, will help accelerate the growth of the mortgage market for all income levels”.
Interested members of the public would have to log on to the scheme’s website, www.housingfinance.gov.ng where one would go through a checklist on eligibility requirements to verify he is a Nigerian and has been paying taxes regularly. “Once you have ascertained that you do meet the eligibility requirements you will be led to complete a very simple form requesting your personal details, those of your employer, state of origin, state of residence, salary range.
“Once you have completed the forms and have read the terms and conditions for participation you will submit the form. Upon submission you will be able to print out a copy of your completed form, or you can direct the completed form online to a mortgage lender of your choice for further processing for pre-qualification”, Dr. Onkojo-Iweala explained. On how to apply for the mortgage, she said that the process has been simplified such and that it would take between two and six weeks to determine whether or not a pre-qualified applicant is successful.
“Due to new mortgage underwriting standards as prescribed by the NMRC processing times for pre-qualification have been significantly reduced, from the usual six to 9 months (there are stories of 12 to 18 months waiting periods) to three to six weeks subject to the level of risk analyses to be undertaken by the mortgage lender and volume of transactions. Some of our partner mortgage lenders have pledged shorter turnaround times, as short of two days”, she said. On the socioeconomic impact of the scheme, the minister said, “it will lead to the increased contribution of housing to GDP from the current negligible 3.1% of our rebased GDP to the high teens of emerging and developed economies such a Malaysia and the United States.
“It will lead to more jobs being created and to greater economic inclusion. It is estimated that for every new house built 3 direct and 8 new indirect jobs are created. Unlocking the housing sector will mean the creation of thousands of jobs for architects, builders, plumbers, welders, electricians, painters.
