Real estate operatives in West Africa have urged governments in the region to develop a virile mortgage system that will provide access to homeownership.
The experts also emphasised need for increased funding for real estate projects, listing of more Real Estate Investment Trusts (RELTs) for further investment, green building, technology for housing construction and decentralising housing development in city centres.
They spoke at the 8th edition of the West Africa Property Investment Summit (WAPI), entitled, ‘New Frontiers in the New Normal’ held in Lagos.
The Managing Director, Dutum Company Limited, Mr. Temitope Runsewe, said the real estate sector in Africa has a lot of potentials, especially in Nigeria.
Specifically, he said in Nigeria, there are no thriving mortgage systems, whereas anywhere in the world, it is the mortgage sector that grows the real estate sector.
He said a virile mortgage system has to be initiated by a government to add value in the sector, adding that the government needs to fund the sector.
“In Nigeria, the Federal Government has set up a seed fund of about N100 billion for the Family Homes Fund to support homeownership.
“The government should create a pool, whereby mortgage banks can access fund and lend to customers. The Federal Mortgage Bank of Nigeria should be revived for efficiency, while the Nigeria Mortgage Refinance Company (NMRC), should be capitalised with proper structure,” Runsewe said.
“That made us to research on emerging technologies to make our work faster and efficient. We have seen the need to be more climate- friendly in construction and building greener houses because of the environment, which is becoming a major issue demanding everyone’s attention,” he said.
The Head, Real Estate Finance-West Africa for Stanbic IBTC, West Africa, Mr. Tola Akinhanmi, enumerated funding options available for real estate finance, which are meant for credible developer with innovative products, financial strength and sustainable assets.
He explained that when an industry is fragmented, it becomes difficult to harness opportunities. According to him, stakeholders need to remove opaqueness by sharing information, growing the market and creating right framework that will enable investors to support investment.
A senior official of Pennek Nigeria Limited, Michael Obiaju, said real estate is goldmine in Nigeria. However, he said the developments are concentrated on certain demographic zones like Lagos, Abuja, Port Harcourt, hence, the need for a policy to decentralise developments, reduce pressure on urban centres and stop urban migration.
He said: “If government comes up with policies that engineers funding for housing, mortgage avenue and deploy more of pension fund, these will create more opportunities in real estate sector.”
The Senior Director, Development-Africa for Radisson Group, Erwan Garnier, said the hospitality sector has been resilient in 2022 due to huge population, currency devaluation, and COVID-19, which made travelling expensive.
He said the firm opened 16 hotels in Africa, targets key cities in Lagos, Abuja and Port Harcourt to expand the market, adding that the forecast for the industry in 2023 is positive.