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Real Estate Sector Shows Cautious Optimism Amidst Policy Reforms

The real estate sector has undergone significant regulatory changes impacting housing market operations and construction activities. Despite these sweeping reforms, the housing ministry remains committed to its promises, advocating for its policies, and aiming to deliver improved housing for Nigerians. Experts, however, urge the government to reduce the cost of building materials to enhance economic development and improve living conditions, writes Chinedum Uwaegbulam.
 
As the Bola Tinubu administration marks its first year, the government is at a critical juncture. The housing industry faces increasing scrutiny over economic disparities, housing affordability, and social justice. Under the All Progressives Congress (APC), several policies and economic factors have shaped the property market, focusing on economic growth and attracting foreign investment.
 
 
The commercial real estate sector has become an indicator of the nation's economic health and social equity. Inflation and exchange rate fluctuations have created economic uncertainty, leading to rising property prices and rent increases in major cities. This trend has exacerbated housing affordability issues, especially for low- and medium-income earners.
 
Affluent areas like Abuja, Lagos, Port Harcourt, and Kano feature high-value properties, but the fluctuating naira has deterred international buyers and investors. The market's sluggishness is further compounded by soaring costs of building materials, causing many developers to halt or scale back projects. High-interest rates have also impacted borrowing costs, limiting property market supply. Developers have increased off-plan sale prices and adopted dollar rates for new apartments in response to currency fluctuations.
 
Housing Minister Ahmed Dangiwa emphasized the ministry's commitment to Tinubu's Renewed Hope Agenda, focusing on economic growth, poverty alleviation, and fostering investment. The ministry has seen success in affordable housing, slum upgrades, and sector-wide reforms, aiming to position housing and urban development as key to social and economic prosperity.
 
To reduce building material costs, the government plans to boost local manufacturing, create jobs, and reduce import dependency. The newly formed Building Materials Manufacturing Task Team will assess and reform the sector.
 
To increase housing supply, a Multi-Agency Project Delivery Team has been inaugurated to optimize agency strengths and deliver affordable housing. The ministry has also fast-tracked the sale and occupancy of housing units under the National Housing Programme, offering various payment options.
 
Currently, 6,612 housing units are under construction nationwide as part of the Renewed Hope Cities and Estates program, aiming to deliver 50,000 units in the first phase. The program includes 1,000-unit cities in each geopolitical zone and FCT, and 500-unit estates in the remaining states.
 
The housing designs cater to all income brackets, with expandable options for low- and medium-income earners. The first batch of provisional allocation letters for outright payment has been released, reflecting significant interest in the program. The ministry is also targeting 26 areas nationwide for slum upgrading and urban renewal, focusing on essential services like water supply, street lighting, road rehabilitation, drainage construction, and waste management.
 
However, Nathaniel Atebije, President of the Nigerian Institute of Town Planners (NITP), criticized the administration's efforts, citing a lack of realistic plans and stakeholder consultation. He emphasized the need for a National Housing Summit to create and implement a pragmatic housing policy, stressing the importance of planning and infrastructure development before housing construction.
 

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