Stakeholders in the Housing Finance sector have called on the Federal Government to increase financial support to the mortgage industry to boost economic development.
The housing finance providers are of the view that If the mortgage sub-sector in Nigeria must survive and attain its full potential to contribute to the economy, the Government must be supportive and have a progressive outlook for the sector.
Managing Director, Infinity Trust Mortgage Bank PLC, Mr Sunday Olumorin who made the call at the 2022 Annual General Meeting/Workshop of Finance Correspondents Association of Nigeria,(FICAN) in Abuja, said it is pertinent for government to increase funding to mortgage financing in Nigeria, in the provision of adequate and quality housing because the sub-sector has immense potentials to boost economic growth.
Represented by the Group Head, Business Development department of the bank, Mrs Ngozi Chukwu, the M.D stated that ” The Housing Finance Market in Nigeria is capable of growing the GDP of Nigeria to 70-80% of its present size and increasing the stock of affordable housing would accelerate growth of Nigerian middle class, deepen the Nigerian market and increase aggregate demand in the economy”.
Speaking on the theme: Nigeria’s Mortgage System: Regulatory Challenges and Exploring Opportunities, Olumorin emphasized that housing should be given the first lift in every government fiscal and monetary policy to make funds easily accessible and at a cheaper rate for citizens, as every activity in the sector generates employment that will boost and sustain economic growth.
“Any government that seeks to be close to its citizens should prioritize it. This is because the availability and non-availability of shelter affects the psyche of people and the economy. Economically, investment in shelter contributes to fixed asset formation, employment and substantial backward and forward integration with the rest of the economy”, he said.
He highlighted the challenges that bedeviled the Mortgage Banking Sub-sector of the Financial Services Industry in it’s earlier years of existence. These challenges, Mr. Sunday noted seriously hindered the development, scope and reach of housing finance to Nigerians.
Some of the challenges according to the Infinity Trust Boss, included lack of long-term funds, macroeconomic challenges, interest and exchange rates, slow, expensive and bureaucratic procedures of title registration and transfer, unfriendly mortgage laws as well as non-existent mortgage market infrastructure.
The Mortgage Banker however acknowledged that the subsector had made remarkable progress in tackling some of these challenges that confronted it in the last decade.
These significant improvement she said was made possible by the efforts of the Federal Government, through the Central Bank of Nigeria CBN as the external regulatory agency for the Mortgage Banks as well as other efforts.
Despite the significant levels of success, Olumorin assured that the mortgage-banking sub-sector is still striving to achieve more milestones to boost the nation’s economy.
He recommended several measures to further strengthen the industry, part of which was to create increased access to Mortgages for low and middle income earners, and the extension of financial services to them.
He affirmed that Mortgage finance is the key driving force for housing development in Nigeria.