By Akhigbe Dominic.M. Esq.,
WED, SEPTEMBER 13 2017-theG&BJournal-THE MORTGAGE SYSTEM: – The Nigeria mortgage system left much to be deserved. The problems are legendary. Is it the high interest rate or the Federal Mortgage Bank (FMBN) inability to disburse approved loans, or is the Primary Mortgage Institutions (PMI) cat walk or chameleon approach to the process of approvals and disbursement? Where do we go from here? Our Mortgage System is porous not aimed at solving our housing needs. Government needs to proactively review and overhaul the Mortgage System, if it is desirous of solving the stated housing deficit.
Estate developers loan suspended should be reinstated to enable both the real estate Companies and potential subscribers enjoy the attendant benefits. The current loan ceiling of N15m should be reviewed upward and other conditions relaxed. The low income earners and Civil Servants to enjoy the benefits of the National Housing Fund (NHF) or make impact in our national housing need a positive review of this well-intended policy must be done to achieved the result.
INFRASTRUCTURAL PROVISION AND PUBLIC PRIVATE PARTNERSHIP (PPP) COLLABORATION: – The infrastructural development is very important in the development of housing and real estate sector. We are much aware that government alone cannot do everything, hence the need for a public –private collaboration. Let government provide an enabling environment, guidelines, and framework in the implementation of this policy to help provide the needed infrastructures for the development of houses for the people.
The Federal Capital Territory has a lot of districts that need to be opened up, developed and provided with basic infrastructures like road network, water, drainage, electricity and other social amenities. In no time development will spring up and people will begin to move to these areas hence, decongesting the city center. Government therefore need to wake up to these challenges to better the life of the people.. The new FCT Minister should as a matter of urgency move fast in this direction to solve the housing need in the FCT.
The Federal Government also need to create a stable economy with minimal inflation, economy that will have credit mobilization and good banking mortgage system that will enable people to borrow with low interest rate, because houses are expensive and many cannot afford to buy overnight. Government should make concerted efforts to make necessary provisions in the national budget for the housing sector to flourish.
THE CUSTOMER CENTERED PHILOSOPHY:- As stated, there is need to make the Customer the center of business, as he is the decision maker in the market place. The real estate is now a dynamic buyer’s market as without the buyer nothing happens. No matter the fantastic design concept and finished quality, infrastructural provision and security, until a customer buys. Nothing happens unless someone sell something and revenue is generated and profit is actualized. The mix elements (4ps) are but a harmonization to achieve the desired sales goal. Therefore the ultimate work of marketing is purely demand management.
The what, the How, the Why and the When – buyer’s matrix. WHAT does he or she want? – The product and its attributes as he is not only buying a house but a status symbol.. Ambience. The product quality and innovative state of technology. HOW much, terms of payment. Flexible or fixed. Direct payment or Mortgage. The prices and affordability question. Low, Medium, and High Income Prices. WHY-The taste and preferences of customers, quality of Houses and the location, type of infrastructures provided, security, title documents, after sales and facility management services, and other social amenities. WHEN – Completion time and delivery (Lead) time, the state of the house when handing over or taken possession.
It’s of note to mention that economic realities of the time, the current cash squeeze, exchange rate, low workers’ pay, the unemployment and insecurity are other challenges affecting Real Estate Market. One can safely state that, if we can get our economy right by reducing inflation, then the mortgage institutions will develop. We have to encourage and mobilize the primary mortgage institutions and allow them to work both internally and externally and have a pool of funds where people can borrow easily, we can get there.
Finally, If government can reduce inflation in the long run with macro stability in the economy and with mortgage financing institutions, estate development in Nigeria in some years to come will improve greatly as Market demand will be created, and the housing problem will well be addressed.
Akhigbe Dominic.M. Esq., /Property Law Expert/CEO, H.I.E Properties & Homes Ltd/SENIOR STRATEGIC PARTNER, PropertyLogic Incorporated/Seasoned Business Coach/Columnist of The BusinessDay/Contributing Editor, govandbusinessjournal.com.ng…Materials contributed by;A. A. Amos MBA, FCAI