CEO of Northcourt Real Estate, Ayo Ibaru, has underscored the urgent need for effective funding and strategic planning to tackle Nigeria’s housing deficit.
In an interview with ARISE NEWS on Wednesday, Ibaru addressed the recent N250 billion allocation across 36 states, the role of capital markets in boosting housing projects, and the challenges of long-term financing for homeownership.
With a focus on transparency, tax reforms, and international investment, Ibaru emphasised that solving the housing crisis in Nigeria requires collaboration, commitment, and long-term solutions.
In response to the N250 billion allocated across 36 states, Ibaru explained that solving Nigeria’s housing problem requires substantial effort and funding. “It takes a lot to solve the housing problem in Nigeria, considering how long it’s been an issue. It’s good to see that Mophe is trying to put in their own quota.”
He also pointed out that the N250 billion is a significant step, especially in comparison to the proposed N11.5 billion for housing and urban development in the 2025 federal budget.
“It’s good to see that N250 billion has been made available, but it can be more because of the size of the problem we are trying to solve,” he added.
Ibaru noted the need to leverage the capital markets to amplify funding for the housing sector. “What they have to do now is find a way of amplifying that, which is working with the capital market either through green link or sustainability bond raises or sukuk bond system.”
He stressed that the demand for housing is not just a mathematical problem but one of location and viability. “I’m not entirely sure the problem is mathematical; it is really more of where the demand is and when the products are most viable,” he said.
Ibaru continued, noting that addressing housing deficits in densely populated states could help alleviate congestion, and ultimately, spread demand to secondary and tertiary cities.
While commending the efforts, Ibaru called for more transparency in the process. “You have to commend the effort even though I would have wanted a bit more transparency. It’s the same article, but Mophe at some point would need to share a bit more information so we would have an idea of what we are working with.”
Turning to the issue of developer incentives, Ibaru discussed the proposed tax reforms, acknowledging their potential benefits for the industry.
However, he warned that manufacturing construction materials in Nigeria would likely remain expensive in the short term.
“The proposed tax reforms do have quite a bit for developers to look forward to, but in the short term, manufacturing a lot of the construction materials that we bring into the country would be expensive.
“It is probably a move towards a long-term strategy, which is what we have to do if we need to meet the entire demand for housing,” he said.
On the rising cost of rent, Ibaru noted the challenges faced by tenants across Nigerian cities. “You find that even paying rent is now increasingly challenging in all cities. Most landlords have tried their best not to increase rent over the last three years, but I think this year they are left with no other choice.”
Ibaru also addressed the long-term financing challenges for homeownership in Nigeria.
“It’s the funding problem. 25 years, as good as it sounds, can be better. In the case of the Asian Organisation, I went to the East and found that they have 35-40 year mortgages because they understand that when families and individuals are able to solve the housing problem, they are more able to contribute to the overall economy, which moves GDP up, improves borrowing conditions, and reduces civil disturbances because the housing question has been answered,” he explained.
Ibaru concluded by stressing the importance of consistent monitoring and reporting on housing development.
“We have seen boots on the ground, and equipment moved to site. We also need to get to a point where we are honest with ourselves about how many housing units are produced on a quarterly basis at least.”
He also reiterated that the potential for international investment and capital market strategies to improve mortgage rates and offer alternative methods for housing development and purchase.
“If we are able to channel the capital market and attract some international investment and deploy as advertised, then we can start to see the mortgage rate improve and also alternative methods for housing development and housing purchase.”
Boluwatife Enome
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