By Danlami Nasir Isah
The Federal government of Nigeria recently launched the National Development Plan (NDP), a policy document which succeeds the Economic Growth and Recovery Plan (ERGP). The five-year development plan, from 2021 to 2025, has a careful outline for the real estate sector, which is designed to unlock the country’s potential in the housing sector of the economy.
To achieve the goals outlined in the housing sector, the estimated public investment is N3.53 trillion from 2021-2025, with an estimated public investment in urban road development of about N1.68 trillion. The plan was formulated against the backdrop of several subsisting development challenges in the country and the need to tackle them within the framework of medium and long-term plans. These challenges include low and fragile economic growth, insecurity, weak institutions, insufficient public service delivery, notable infrastructure deficits, climate change and weak social indicators.
Hence, the plan seeks to invest massively in infrastructure, ensure macroeconomic stability, enhance the investment environment, improve on social indicators and living conditions, implement climate change mitigation, adaptation and resilience strategies and others. It also aims to generate 21 million full-time jobs and lift 35 million people out of poverty by 2025, thus setting the stage for achieving the government’s commitment of lifting 100 million Nigerians out of poverty in 10 years.
According to the NDP blueprint under review, the government will stimulate construction by building affordable houses and overcoming critical constraints in the housing sector. Between 2017 and 2020, a substantial number of housing units were completed, while several other units are currently at various stages of completion. Specifically, under the five-year housing development plan, the government’s target is to improve access to affordable housing by increasing supply rate from 500,000 to 1,000,000 homes per year; improve linkages between the housing sector and the real estate contribution to Gross Domestic Product (GDP) from 5.7 per cent to 8.38 per cent; decrease urbanization rate from 52 per cent to 40 per cent, as well as rural-urban migration from 6.5 per cent 5.0 per cent.
In the 195-page document, the Federal Government will establish Urban and Regional Development Boards (URDB) and charge them with the responsibility for the overall supervision, including monitoring and management of urban development, as well as planning across states. Also, there are provisions in the document to create and implement a national urban development policy that focuses on urban renewal, provision of low/medium income housing, while checking rural to urban migration.
In specific terms, the policy document is hinged on reducing “the percentage of urban residents who live in slums from 69 per cent to 55.2 per cent in order to make cities and human settlements inclusive, safe, resilient and sustainable by keying into the SDGs. It will also ensure an increase of the government’s social housing budget for highly vulnerable persons, including people living with disabilities (PLWDs), low-income earners, among others, with a target of at least 10 per cent reduction in housing deficit within the next five years.
“This will help to phase out slums, substandard housing, and to provide comfortable shelter for the homeless through social and affordable housing that meets international standards and aligns with the SDG of creating sustainable cities and communities by working with stakeholders in both the public and private sectors, utilizing local capacity and materials.
“The government intends to bridge the gap between housing demand and supply constraints; create rental housing opportunities for at least 500,000 citizens; reduce the demand for multiple years’ rent payment; bring unused and empty houses into use, especially in urban areas; make housing payment affordable by matching it with income receipts; deliver site and service schemes that engender at least 50,000 plots of land in each state of the federation, including the FCT, for housing development.”
Subsequently, the plan includes a provision to develop local content and know-how for building construction and technology and materials sub-sector. Part of the document reads:
“The government will promote and increase the use of local building materials to achieve a target of 75 per cent of building components through the creation of an investment climate that engenders building manufacturing investment; promote and increase the use of alternative building materials and new technologies in housing delivery through incisive research and development and execution of pilot projects in each state of the federation and the FCT; apply building materials-focused research and development by way of pilot housing schemes built majorly from alternative locally produced materials and new technology; incentivize and adopt low-cost housing construction technologies and innovative affordable housing delivery methods.”
With the outlined plan for the building and real estate sector, the federal government seems confident that it will go a long way to bridge the housing gap in the country. However, the proclamation on the lips of many experts and Nigerians is that with a chunk of money coming from the private sector, how the federal government executes the plan effectively is still not yet cast in stone.