Stakeholders denounce a manly mortgage system in Africa

Real estate agents in West Africa have urged governments in the region to develop a manly system of mortgages that will provide access to property.

Experts also highlighted the need to increase funding for real estate projects, list more Real Estate Investment Trusts (RELTs) for new investments, green building, technology for housing construction and decentralization of the housing development in city centres.

They spoke at the 8th edition of the West Africa Real Estate Investment Summit (WAPI), titled “New Frontiers in the New Normal”, held in Lagos.

The Managing Director of Dutum Company Limited, Mr. Temitope Runsewe, said that the real estate sector in Africa has a lot of potential, especially in Nigeria.

Specifically, he said, in Nigeria there are no thriving mortgage systems, while all over the world it is the mortgage industry that drives the real estate industry.

He said a manly system of mortgages must be initiated by a government to add value in the sector, adding that the government must finance the sector.

"In Nigeria, the Federal Government has set up a seed fund of around N100 billion for the Family Homes Fund to support home ownership.

“The government should create a pool for mortgage banks to access funds and lend to customers. The Federal Mortgage Bank of Nigeria should be revived for greater efficiency, while the Nigeria Mortgage Refinance Company (NMRC ) should be capitalized with proper structure,” Runsewe said.

“It pushed us to research emerging technologies to make our work faster and more efficient. We saw the need to be more climate-friendly in construction and to build greener homes due to the environment, which is becoming a major issue requiring everyone's attention.

“The financing challenge is related to the macroeconomic situation of any country. When you have a stable currency, foreign direct investment will come,” he said.

Real Estate Finance Manager-West Africa for Stanbic IBTC, West Africa, Mr. Tola Akinhanmi, listed the financing options available for real estate finance, which are aimed at credible developers with innovative products, financial strength and sustainable assets.< /p>

He explained that when an industry is fragmented, it becomes difficult to exploit opportunities. According to him, stakeholders must eliminate opacity by sharing information, developing the market and creating an adequate framework that will allow investors to support investment.

A senior official of Pennek Nigeria Limited, Michael Obiaju, has said that real estate is a goldmine in Nigeria. However, he said, the developments are concentrated in certain demographic areas like Lagos, Abuja, Port Harcourt, hence the need for a policy of decentralizing developments, reducing pressure on urban centers and stop urban migration.

He said, "If the government comes up with policies that organize housing finance, the avenue of mortgages and deploy more pension funds, it will create more opportunities in the real estate sector."

Radisson Group's Senior Director, Development-Africa, Erwan Garnier, says the hospitality sector held up well in 2022 due to huge population, currency devaluation and COVID-19 , which made travel expensive.

He said the company had opened 16 hotels in Africa and was targeting the key cities of Lagos, Abuja and Port Harcourt to expand the market, adding that the outlook for the industry in 2023 was positive.