The African Development Bank (AfDB) on Thursday 11th November 2021, approved a $60m (approximately ₦25Bn) financing for the Homes Loan Assistance Programme. The fund, according to the bank, will be managed by the Family Homes Funds Limited (FHFL) with the support of the Federal Ministry of Finance, Budget and National Planning. Even though it took some time to materialize, because the Federal Government has been seeking this funding since 2018, it will strengthen the Government’s efforts towards providing housing for the low-income earners in the country. The following paragraphs explain the Federal Government and AfDB partnership journey so far, and facts about the Financing Homes Loan.
The Federal Government has been in talks with the AfDB since 2018 on funding low cost housing in Nigeria.
The AfDB’s overarching objective is to spur sustainable economic development and social progress in its Regional Member Countries (RMCs) including Nigeria. Since its inception in 1964, the bank has been making conscientious efforts to drive this mandate and contribute to poverty reduction. In 2018, the Federal Government commenced negotiations with the African Development Bank AfDB, the World Bank alongside other financial institutions to raise c. ₦800 million which is planned to fund the construction of affordable housing for income households in Nigeria. The CEO of the Family Homes Funds, Mr. Femi Adewole defined this segment as Nigerians earning below ₦100,000 per month in household income. The fund was being negotiated under the Family Home Funds FMF, a housing investment fund owned by the Sovereign Wealth Fund and the Ministry of Finance.
The $60m (approximately ₦25Bn) financing from the AfDB will support the Federal Government’s effort to promote access to affordable housing.
The $60m (approximately ₦25Bn) financing is positioned to enhance access to affordable housing. According to Mrs. Aisha Omar, who is the Director International Economics Relations at the Ministry of Finance, Budget and National Planning, the facility will support the Federal Government’s efforts to promote access to affordable housing finance for low-income families through the Family Homes Funds. The Loans Assistance programme, according to her, will offer a low-cost, deferred equity loan for up to 40% of the cost of homes, and reduce mortgage burden by 50%. She also noted that it is estimated that at least 18,750 beneficiaries will be supported through this proposed intervention, and the funding will create approximately 9,375 direct jobs.
Financing for Homes Loan (FHFL) Assistance Programme has completed 5,408 homes in 8 States in Nigeria
FHFL is actively working with State Governments across the country and private developers to facilitate the construction of affordable houses for the low income population with financial assistance through the Help To Own Programme. According to the Family Homes Fund, they have now completed 5,408 homes across eight states, with 9,148 under construction and another 13,543 commencing building works before December 2021. According to their website, FHFL is also implementing the Nigeria government’s National Social Housing Programme (NSHP) that will provide up to 300,000 homes and lead to the creation of 1.5 million jobs across the country.
Let us know your thoughts about this round of funding, and how it will impact affordable housing delivery in the country by sending an email to [email protected].