In 2012, the Central Bank of Nigeria (CBN) released revised guidelines on the operations of the primary mortgages institutions (PMIs) in Nigeria in another attempt to reposition the sector for the revival of affordable housing financing in the country. The revised guidelines raised the minimum capital base of PMIs significantly in addition to streamlining the activities of players and setting out new prudential requirements. This report reviews the current state of the housing and mortgage finance sub-sector and evaluates the significance of the upward revision in the capital base of the PMIs among other things…..

Estimated at about 32 million households, over 50% of Nigerians are either homeless or live in inadequate shelter. According to the National Bureau of Statistics (NBS), it is estimated that 56.4% or 17.8 million households living in urban areas are in either rented houses or unpaid makeshift accommodation. In Lagos alone, the figure was as high as 73.8% in 2006. More alarming is the distribution of this housing gap…..

The colossal housing deficit in Nigeria has been estimated to require the entire federal government budget compounded for 10 years. Applying a mid-level unit price of N10 million per average house suggests a market size or required investment of between N50 trillion and N60 trillion. This gap exists despite the availability of a mortgage financial system and institutions…..

The land use regulation and difficult title registration procedures added to the failure of housing supply to meet the ever increasing demand as individuals who ordinarily should be able to walk into their banks to access mortgages are faced with the bureaucratic difficulties associated with obtaining the Certificate of Occupancy (C of O), without which the loans cannot be released……

The failure to deliver on their mandate perhaps led to the commencement of the reform of the PMIs through a 10-point mortgage banking reform agenda in 2006 aimed at repositioning the subsector for effectiveness. At the core of the reform agenda was the phased recapitalisation of the PMIs between 2007 and 2010 to achieve minimum recapitalisation of N2 billion with emphasis on actual injection of fresh funds to boost PMIs’ funding capacity….

For more information please click on the following link: Primary Mortgate Institutions in Nigeria

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