5th Element of the 7 Point Agenda - Land tenure changes and ownership

5. Land tenure changes and ownership:

Nigeria is ranked as the most populous African country, with 64 % of her population resident in the rural areas. The current trend in rural – urban migration applies ample pressure on infrastructure and social amenities in the major urban and metropolitan cities. This calls for concern and action.
One of the ways which this government plans to alleviate this situation is by providing sufficient and affordable housing. The 7-Point Agenda is proposing a paradigm shift in land laws so as to optimize growth through the release of land for housing, commercialized farming and large scale businesses by the private sector. Further changes will include persuading the state governments to convert their Housing Corporations into land companies with the mandate to develop new towns within the states; to reorganize the Federal Housing Authority (FHA) and to provide mortgage insurance for affordable housing. Nigeria has a huge housing deficit. This is evidenced by low levels in the real estate sector and mortgage credits which together accounts for less than 1% and 0.5% of GDP respectively. These factors have led to the evolution of the current National Policy on Urban Development and Housing that provides for a private sector-led housing policy with the government providing the enabling operating environment. The paucity of long term funds has been the bane of housing finance in Nigeria and the banking sector has consistently demonstrated its aversion to financing home ownership. Our legal and regulatory environment is characterized by archaic laws inhibiting efficient land transaction, while prevailing monetary and fiscal parameters are not conducive for sustainable housing finance. Furthermore, the existence of weak primary mortgage structures with attended weak capitalization, poor corporate governance and technical skill deficiencies have worsened the situation

The solutions to land administration problems therefore include:

· expunging the Land Use Act from the Constitution;

· reviewing the Land Use Act, particularly removing the provision pertaining to Governor’s consent to assign and mortgage;

· establishing specialized courts to determine the terms and timing of challenge/contestation of foreclosures; and the

· Computerization of all land related records at all levels.

Other changes include the need to persuade state governments to convert their housing corporations into land companies with a mandate to develop new towns in the state, reorganize the Federal Housing Authority (FHA) to provide mortgage insurance for affordable housing, passage of foreclosure and securitization laws, sustaining the Federal Mortgage Bank of Nigeria as a secondary mortgage institution, refinancing mortgage loan originators through the capital market and the provision for legal protection of lenders against bankruptcy to attract investors in housing finance.