Mr. Benjamin Onigbide, a Real Estate Economist, is the Chief Executive Officer (CEO), Sigvent Property Trust Limited in Abuja. In this interview with TOPE SUNDAY, he decries high cost of building construction; and suggests the way out.
Despite Nigeria’s huge housing deficit there are a lot of unoccupied houses in Abuja, what do you think is responsible for this?
Yes, there are so many unoccupied houses in Abuja. Many wealthy people built houses in Abuja without any intention of living there. They prefer to live abroad and just transfer money to the security man at the end of the month for just looking after the house. And there is nothing the government can do about it because it didn’t build the house for them. For instance, someone in Abuja built a house of eight (8) seating rooms and installed more than 30 televisions so that you can monitor the news even from the toilet, but he spends more time outside the country than in the house, which remains unoccupied. When we came into the market, we attempted to get buyers for the unoccupied property, but the prices were too high and unaffordable, while the building is deteriorating because it is not occupied.
Some experts in the built environment have advocated zero interest rate for estate developers. What is your reaction to this?
I am a financial person and I can tell you that it is very difficult to control the issue of finance in real estate sector. The minimum lending rate is 19 percent and some banks lend at 20 to 25 percent. The banks are out to do business, except if government wants to subsidise banks. It is the Federal Mortgage Bank of Nigeria (FMBN) that agreed to give interest free loans but still monitors the development of the property.
Also, high cost of building has been identified as another problem confronting the real estate sector. What is the way out?
In Sigvent, we are bringing technological innovation into real estate. We have a partner, Viva Technologies that came in from Israel with interlock blocks to bring down the cost of construction. As a result, you can complete a bungalow within a week and it is cheaper. When you have your DPC level, they interlock the blocks with spray plastering. They will spray the concrete around and seal the building. Our target is to make houses affordable to Nigerians.
What are you doing as a private firm to bridge the 17 million housing deficit in the FCT?
If truth must be told, it is not only Abuja as a mega city that has this huge housing deficit. Nigeria as a country is also struggling with over 200 million housing deficit. So, as a company, we have studied this statistics, and discovered that people about 50 years don’t have houses of their own; they are still paying rent. And when you look at this, you will discover that children of these people may not have houses to live in the nearest further. To this end, we are targeting the young people through our affordable housing scheme. We are targeting that if you can buy a car for about 7 to 8 million naira, you should be able to buy a house around that amount.
How do you intend to achieve this?
We are poised to revolutionise the real estate industry with the introduction of Sigvent Residence, the company is pioneering Millennial Housing Scheme that is targeted at reducing the home ownership gap in the economy. Sigvent Residence is a Lifestyle Community branded estate that is targeted at the young people from 30 years and above. The branded estate will provide young and first time home owners with comfort and functionality that matches their lifestyles.
So, what strategies are you introducing to reduce cost of building construction in the country?
High cost of construction is another major problem that bedevils the housing sector in the country. But one of the strategies employed by our company is its collaboration with an innovative construction firm which produces Compressed Earth Bricks. This collaboration with Ipile Synergy Construction Limited for the construction of SigVent Residence will reduce construction cost between 30-45 per cent. Sigvent Residence supports the government vision that aims to bridge the housing gap and maximized the contribution of the real estate industry to drive the country towards sustainable infrastructure growth.
With all you have said, will the average Nigerian be able to afford the houses you will be coming up with?
No, we are not. What we have is an affordable and decent housing offer that is targeted at the young people, and its payment plan is flexible. With about N8 million, you can own a three-bedroom flat, and the payment plan will spread for three years. In Abuja, we have about three sites for this scheme. So, we are targeting three years from land acquisition to housing delivery. To ensure quality, we are targeting six months for the sales of the land, and another six months for the provision of infrastructure. So, with the way our housing scheme is designed, there is no way it will not be affordable and convenient for our subscribers.