Mr Mike Nwuafor is the CEO of Minarc Limited, a multi asserted organisation that does consultancy for the builders, architects, quantity surveyors, engineering firms. It also renders services on sale of houses. In this interview with Viewpoint Housing News in Abuja, the CEO suggests ways government will be able to fulfil its promise of providing affordable housing to the generaility of Nigerians.
Viewpoint: How has business environment been in the last three years for your company?
Nwuafor: Well, I guess it’s been what it has been to others who do similar business like us. There’s possibility that Nigeria is coming out of recession. The first industry that feels recession whenever it takes place is the housing industry because the purchasing power of the populace is greatly affected. So it’s been tough, resulting in reduced quantity of production. Even when the quantity produced is low, selling them has been a little bit difficult.
Viewpoint: Developers are not producing for the low income population that is a huge market. How can developers be made to do this?
Nwuafor: Government intervention. Developers are private sector people and they have their own channel of income and when they produce they want to get back their money. If you tell them to go and produce for the low income people, how soon will the low income earner buy? How fast will they pay when they buy?
So because the flow is not as expected, they will rather go to the high income bracket because we produce to sell and get back our money and business goes on. If government wants the low income earners to be able to access affordable housing by having what they want produced for them you will…Notice that I don’t want to use the word low income housing but I say low income earners. But if you are going to produce houses for the low income bracket then there has to be an intervention in how these houses are bought or purchased.
If the government doesn’t do that no private person will like to go and put his money where he is not likely to get back his money soonest. Because of that, they move over to the higher income bracket. But if the government wants low income houses to be produced, then there has to be an intervention. Where is this intervention coming from?
One, access to land makes that less cumbersome. Let developers get the land at almost for nothing.
Two, provide mortgages. If the government provides mortgages by the combination of primary mortgage institutions, developers will be able to get back their money and allow the mortgage organisations to deal with whatever. And government should make percentages available for these low income people through their offices, their co-operatives make. Get them to put resources together, share the cost and make it available.
Viewpoint: The APC government promised that they will deliver a million housing units if voted into power. This is the party’s third year in office. As a stakeholder in the business of building houses, can you say this promise has been kept?
Nwuafor: Well for the APC government, I think the first thing they did was to make a promise that this is what they will do if voted into power and at the base of that Nigerians said ok let’s give them the opportunity to give us shelter over our heads. Having gone round the states, I know there is some good news that is coming from the housing axis of the government. Whether it has impacted the populace or the society is another question but I guess we probably need time to feel the impact of the government in respect of the production of houses and in access to the houses produced. So I think we should all just give APC a chance and see what they will have to do in the housing sector.
But if you ask me, I will tell you the surest way of inflating an economy is to inject more into the housing system. Do that and wipe recession overnight. All what APC needs to do is to stimulate action in all the things they need to do.
The biggest driver in the production of these houses is not the government but the private sector particularly those in the production of houses.
Viewpoint: There appears to be a lull in the real estate market. How are estate companies braving the element?
Nwuafor: So many estate organisations are shutting down, many are in debt because you cannot produce large volume of houses without access to . And when you take these facilities and you don’t sell, you can’t pay back and I think that is where the biggest problem of most people in the estate industry lies.
Houses are produced but not sold. If you ask me, I will do what the former government did when they had recession. They can inject some money into the housing sector. Government should assist and write off developers loans because if developers are out of market, it will create more unemployment in the country.
Viewpoint: What is the relationship between REDAN and the Federal Ministry of Works and Housing?
Nwuafor: The relationship has been good and is still good. The ministry has related with REDAN as it should even though we are saying let the synergy be a little deeper, more productive. Let REDAN be seen as the cartelist for housing development by putting them where they ought to be. The government cannot produce these houses alone without the help of estate developers powered by REDAN and see how well we all will be able to tackle this housing deficit that we have been facing for years.
