Lagos - A university lecturer, Prof.
Timothy Nubi, on Tuesday told the Federal Government to restructure Nigeria’s
mortgage system to position it for better service delivery.
Nubi, who is of the Department of Estate Management in the
University of Lagos, made the call in an interview with the News Agency of
Nigeria (NAN) in Lagos.
He said that solution to the nations' housing deficit would
not be possible without a functional and sustainable mortgage system.
Nubi said that Nigeria had failed to solve its housing
problem because short-term funds were being used to finance long-term projects.
According to him, housing projects are long-term projects
and should be funded with long-term loans.
Nubi argued that a viable mortgage system was the bedrock of
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“Presently in the country, accessing funds to build houses
is very difficult, due to the near-absence of a functional mortgage sector.
''This is despite the fact that mortgage system had been in
operation in the country for many years.
“The fact that its impact has not been felt in the sector
compared to what obtains in advanced countries shows that a more pragmatic
strategy must be adopted to bridge the nations' housing deficit.''
Nubi said that other developed and developing countries were
able to overcome their housing problems because they gave mortgage loans at
single digit interest rates.
"And the loan is spread over a long period of time to
enable the developer recoup the money and payback,’’ he said.
The don said that interest rates or charges payable on a
mortgage and the tenure of the loan were critical elements of affordability.
He suggested that the mortgage system should be streamlined
to be given at single digit interest rates and spread over a long period of
time, like 20 to 25 years.
Nubi noted that embracing such system would enable more
people to be able to take and repay mortgage loans.
“The Primary Mortgage Institutions still lend at very high
interest rates in addition to asking for deposits which negate the quest for a
virile mortgage sector that would aid house ownership.
“If government structures 20-25 years mortgage at 7-8 per
cent -- which is even still higher anyway, many Nigerians will own houses.
“Because the rent Nigerians are paying right now is more
than enough of what they need to service their mortgage and own the house,” he