Crowdfunding for Housing in Nigeria
Posted on 27/03/2024 1:32 PM | by NaijaHouses
Experts within the built environment sector are urging the government to explore crowdfunding as a solution to alleviate the housing deficit in the country.
Kehinde Haastrup, the Brand and Marketing Associate at Mixta Africa, emphasized the potential of crowdfunding to pool small contributions from a large number of individuals, forming a substantial fund for housing projects. This approach would broaden the base of financial contributors, easing the burden on individual homebuyers and developers.
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Haastrup highlighted the emergence of microfinance and community-based institutions targeting low-income individuals and communities, offering microloans for housing improvements or small-scale construction projects. These initiatives empower communities to address housing challenges collectively and incrementally enhance their living conditions.
Dr. Roland Igbinoba, President of the Nigerian Proptech Association, acknowledged crowdfunding as an innovative avenue for real estate funding, particularly beneficial for small and medium-scale developers aiming to construct affordable housing. He emphasized its potential to democratize real estate investment and prioritize affordable housing over luxury developments, thus reducing the housing deficit.
Haastrup explained that crowdfunding encompasses various purposes beyond real estate, while community-based funding focuses on localized initiatives within specific communities. He highlighted Mixta Africa's DUO rent-to-own payment scheme as an example, providing a pathway to homeownership for individuals facing upfront costs barriers.
Under DUO, individuals can lease a property with an option to buy later, with their annual payments contributing towards the property's purchase price, making homeownership more accessible.
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