The Federal Government plans to create a N1 trillion ($654 million) housing fund to provide affordable mortgages for Nigerians, addressing the country’s estimated deficit of 28 million homes, according to Bloomberg.
During a media briefing on Tuesday, Finance Minister Wale Edun announced that the initial phase of this fundraising initiative will include a 40-year concessional loan from the World Bank’s International Development Association (IDA) at a 1% interest rate.
Edun noted that the government has secured matching contributions from local pension funds, banks, and insurance companies, raising a total of N250 billion in this first phase.
“This fund will allow Nigerians to access mortgages at single-digit and low double-digit interest rates, making homeownership more achievable,” he stated.
Nigeria, the most populous country in Africa, is grappling with a significant housing shortage. Most real estate transactions are conducted in cash, a practice that has led to corruption and exploitation by dishonest operators. At present, mortgages contribute to less than 1% of the nation’s GDP, underscoring the urgent need for organized financing solutions.
According to the Federal Mortgage Bank of Nigeria, the country needs at least 28 million more homes to satisfy demand. Edun mentioned that the new fund is anticipated to spark a construction boom by offering developers guaranteed buyers.
